II
117th CONGRESS
1st Session
S. 1889
IN THE SENATE OF THE UNITED STATES
May 27, 2021
Mr. Burr (for himself and Mr. Bennet) 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 establish an exception to the penalty on early distributions from qualified plans for individuals diagnosed with certain terminal illnesses.
Short title
This Act may be cited as the Kathryn Manginelli Act of 2021
or the Compassionate Retirement Act of 2021
.
Exception to penalty on early distributions from qualified plans for individuals with a terminal illness
In general
Section 72(t)(2) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph:
Terminal illness
In general
Distributions which are made to the employee who is a terminally ill individual on or after the date on which such employee has been certified by a physician as having a terminal illness.
Definition
For purposes of this subparagraph, the term terminally ill individual has the same meaning given such term under section 101(g)(4)(A), except that 84 months
shall be substituted for 24 months
.
Documentation
For purposes of this subparagraph, an employee shall not be considered to be a terminally ill individual unless such employee furnishes sufficient evidence in such form and manner as the Secretary may require.
.
Effective date
The amendment made by this section shall apply to distributions after the date of the enactment of this Act.