S. 2086Senate109th Congress (2005-2007)In Committee

IRA Equity Act of 2005

Introduced December 13, 2005

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SenateIntro Referral Latest Action

Read twice and referred to the Committee on Finance.

December 13, 2005

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SenateIntro Referral

Introduced in Senate

December 13, 2005

SenateIntro Referral

Sponsor introductory remarks on measure. (CR S13504)

December 13, 2005

SenateIntro Referral

Read twice and referred to the Committee on Finance.

December 13, 2005

Floor Debate

6 members

What members said about S. 2086 on the floor

2 Republicans4 Democrats
Saxby Chambliss
Sen. Saxby ChamblissR-GA · Dec 13, 2005

Mr. President, I rise to introduce the Agricultural Employment and Workforce Protection Act. My home State of Georgia is one of the most diversified agricultural producing States east of the…

Max Baucus
Sen. Max BaucusD-MT · Dec 13, 2005

The Greek philosopher Plato warned, ``where there is an income tax, the just man will pay more, and the unjust man will pay less on the same amount of income.'' This phrase is telling. The way people…

Joseph R. Biden Jr.
Sen. Joseph R. Biden Jr.D-DE · Dec 13, 2005

Mr. President, today I introduce legislation to ensure that the United States does create new arrears at the United Nations. At a time when our Government is seeking important reforms at the United…

Bill Nelson
Sen. Bill NelsonD-FL · Dec 13, 2005

Mr. President, over the last several years, hundreds of Americans have died from the poisonous carbon monoxide emitted from portable gas generators. Congress needs to step in and act quickly to stop…

Wayne Allard
Sen. Wayne AllardR-CO · Dec 13, 2005

Mr. President, I rise to introduce the Hurricane Katrina Recovery Homesteading Act of 2005. Modeled on the United States' 19th century homesteading initiatives and similar urban programs in the…

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Frank R. Lautenberg
Sen. Frank R. LautenbergD-NJ · Dec 13, 2005

Mr. President, today I am joined by Senator Smith in introducing the IRA Equity Act of 2005, which would allow the disabled and those who temporarily leave the workforce to continue to save for their…

Frank R. Lautenberg
Sen. Frank R. LautenbergD-NJ · Dec 13, 2005

Mr. President, today I am joined by Senator Smith in introducing the IRA Equity Act of 2005, which would allow the disabled and those who temporarily leave the workforce to continue to save for their…

Bill Text

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Introduced in SenateIssued December 13, 2005

II

109th CONGRESS

1st Session

S. 2086

IN THE SENATE OF THE UNITED STATES

December 13, 2005

Mr. Lautenberg (for himself and Mr. Smith) introduced the following bill; which was read twice and referred to the Committee on Finance

A BILL

To amend the Internal Revenue Code of 1986 to modify the definition of compensation for purposes of determining the limits on contributions to individual retirement accounts and annuities, and for other purposes.

1.

Short title

This Act may be cited as the IRA Equity Act of 2005.

2.

Computation of limits on IRA and Roth IRA contributions

(a)

Certain wage replacement income treated as compensation

(1)

Wage replacement income

Section 219(f) of the Internal Revenue Code of 1986 (relating to other definitions and special rules) is amended by adding at the end the following new paragraph:

(8)

Treatment of certain wage replacement income as compensation

(A)

In general

Notwithstanding paragraph (1), applicable wage replacement income not otherwise treated as compensation shall be treated as compensation for purposes of this section.

(B)

Applicable wage replacement income

For purposes of this paragraph, the term applicable wage replacement income means any amount received by an individual—

(i)

as the result of the individual having become disabled,

(ii)

as unemployment compensation (as defined in section 85(b)),

(iii)

under workmen's compensation acts, or

(iv)

which constitutes wage replacement income under regulations prescribed by the Secretary.

(2)

Certain excludable amounts may be taken into account for purposes of Roth IRAs

Section 408A(c)(2) of such Code (relating to contribution limit) is amended by adding at the end the following new flush sentence:

In determining the maximum amount under subparagraph (A), subsections (b)(1)(B) and (c) of section 219 shall be applied by taking into account compensation described in section 219(f)(8) without regard to whether it is includible in gross income.

(3)

Effective date

The amendments made by this subsection shall apply to taxable years beginning after December 31, 2004.

(b)

Computation of maximum IRA deduction for Roth IRAs using compensation from 2 preceding taxable years

(1)

In general

Section 408A(c) of the Internal Revenue Code of 1986 (relating to treatment of contributions) is amended by adding at the end the following new paragraph:

(8)

Compensation from preceding 2 years may be taken into account

(A)

In general

A taxpayer may elect for purposes of paragraph (2) to take into account any unused compensation from the 2 taxable years immediately preceding the taxable year.

(B)

Unused compensation

For purposes of this paragraph, the term unused compensation means with respect to an individual for any taxable year the compensation includible in the individual's gross income for the taxable year reduced by the sum of—

(i)

the amount allowed as a deduction under 219(a) to such individual for such taxable year,

(ii)

the amount of any designated nondeductible contribution (as defined in section 408(o)) on behalf of such individual for such taxable year,

(iii)

the amount of any contribution on behalf of such individual to a Roth IRA under this section for such taxable year, and

(iv)

the amount of compensation includible in such individual's gross income for such taxable year taken into account under section 219(c) in determining the limitation under section 219 or paragraph (2) for the individual's spouse.

(C)

Application to special rule for married individuals

Under rules prescribed by the Secretary, in applying section 219(c) for any taxable year for purposes of applying paragraph (2)(A), unused compensation of an individual or an individual's spouse for the 2 taxable years immediately preceding the taxable year may be taken into account.

(2)

Effective date

The amendment made by this subsection shall apply to taxable years beginning after December 31, 2004, but unused compensation for taxable years beginning before January 1, 2005, may be taken into account for taxable years beginning after December 31, 2004.