Sec. 3. Increasing spousal protection under defined contribution plans
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Part 2 of subtitle B of title I of the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1051 et seq.) is amended by inserting after section 205 the following new section: Each individual account plan to which section 205 does not apply shall provide that, except as provided in subsections
(c)and (d), no distribution may be made under the plan unless the spousal consent requirements of subsection
(e)are met. Nothing in this section shall be construed to exempt an individual account plan from the requirements of paragraph (1)(C) or
(2)of section 205(b) with respect to any participant. Subsection
(a)shall not apply to— any distribution that is— a minimum required distribution described in section 4974(b) of the Internal Revenue Code of 1986; a result of the use of the participant's accrued benefit as security for a loan, including any distribution required by reason of a failure to comply with the terms of such loan; made upon hardship of the participant; or permitted under section 203(e)(1) to be made without the consent of the participant; any distribution in the form of a qualified joint and survivor annuity (as defined in section 205(d)(1)), a qualified optional survivor annuity (as defined in section 205(d)(2)), a qualified preretirement survivor annuity (as defined in section 205(e)), or a series of substantially equal periodic payments (not less frequently than annually) made for the joint lives (or life expectancies) of the participant and the participant's spouse; or in the case of a participant who does not elect a form of benefit described in paragraph
(2)under the plan or who is participating in a plan that does not provide such a form of benefit, any distribution of the participant's entire nonforfeitable accrued benefit if 50 percent of such accrued benefit is transferred to an individual retirement plan (as defined in section 7701(a)(37) of the Internal Revenue Code of 1986) of the spouse of the participant. A transfer described in paragraph
(3)to an individual retirement plan shall be treated in the same manner as a transfer under section 408(d)(6) of the Internal Revenue Code of 1986. Subsection
(a)shall not apply to any distribution that is an eligible rollover distribution (as defined in section 402(f)(2)(A) of the Internal Revenue Code of 1986) made in the form of a direct trustee-to-trustee transfer within the meaning of section 401(a)(31) of the Internal Revenue Code of 1986— to a plan to which this section or section 205 applies; or to an individual retirement plan (as defined in section 7701(a)(37) of the Internal Revenue Code of 1986) if— the beneficiary of such plan is the spouse of the participant, or the spousal consent requirements of subsection
(e)are met with respect to any designation of 1 or more other beneficiaries; and the beneficiary of such plan (whether the spouse or other beneficiary designated under paragraph (1)) may not be changed unless— the spousal consent requirements of subsection
(e)are met with respect to any such change, or the spousal consent under subparagraph
(A)to the designation of a beneficiary other than the spouse expressly permits such designation to be changed without the further consent of the spouse. For purposes of this section, except as provided in paragraph (2), the spousal consent requirements of this subsection are met with respect to any distribution or any designation or change of beneficiary if— the plan provides to each participant, within a reasonable period of time before such distribution or designation or change of beneficiary is made and consistent with such regulations as the Secretary of the Treasury may prescribe, a written explanation of the rights of the participant and the participant's spouse under this section; the spouse of the participant consents in writing to the distribution or designation or change of beneficiary; in the case of a distribution, the written consent under subparagraph
(B)is made during the consent period; and the written consent under subparagraph (B)— acknowledges the effect of such distribution or designation or change of beneficiary; and is witnessed by a plan representative or a notary public. The requirements of paragraph
(1)(other than subparagraph
(A)thereof) shall not apply with respect to any distribution or designation or change of beneficiary if a participant establishes to the satisfaction of the plan administrator that— there is no spouse; the participant and the participant's spouse have not been married throughout the 1-year period ending on the date of the distribution or designation or change of beneficiary; or such consent cannot be obtained because— the spouse cannot be located; due to exceptional circumstances, requiring the participant to seek the spouse's consent would be inappropriate; or of such other circumstances as the Secretary of the Treasury may by regulations prescribe. Any written consent by a spouse under paragraph (1), or the establishment by a participant that an exception under paragraph
(2)applies with respect to a spouse, shall be effective only with respect to that spouse and to the distribution or designation or change of beneficiary to which it relates. For purposes of this subsection, the term consent period means, with respect to any distribution— the 90-day period immediately preceding the date of such distribution; or such other period as the Secretary of the Treasury may provide. Rules similar to the rules of section 205(c)(6) shall apply for purposes of this section. . The table of sections of part 2 of subtitle B of title I of the Employee Retirement Income Security Act of 1974 is amended by inserting after the item relating to section 205 the following new item: Sec. 205A. Additional spousal consent requirements. . Section 502(a) of the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1132 ) is amended by striking or at the end of paragraph (10), by striking the period at the end of paragraph
(11)and inserting ; or , and by adding at the end the following new paragraph: by an individual for appropriate relief in the case of a violation of the individual's rights under section 205A. . Section 205(c)(2)(B) of the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1055(c)(2)(B) ) is amended by inserting , because due to exceptional circumstances requiring the participant to seek the spouse's consent would be inappropriate after located .
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Sec. 3
Increasing spousal protection under defined contribution plans
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