Sec. 109. DISREGARD OF CERTAIN CONTRIBUTION INCREASES FOR WITHDRAWAL LIABILITY PURPOSES
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## SEC. 109 DISREGARD OF CERTAIN CONTRIBUTION INCREASES FOR WITHDRAWAL LIABILITY PURPOSES ###
(a)Amendment to Employee Retirement Income Security Act of 1974 Section 305 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1085) is amended— ####
(1)in subsection (e), by striking paragraph (9); ####
(2)in subsection (f)— #####
(A)by striking paragraph
(3)and redesignating paragraph
(4)as paragraph (3); and #####
(B)in paragraph
(3)(as redesignated by subparagraph (A)), by striking “During the rehabilitation plan adoption period—” and inserting “During the period beginning on the date of the certification under subsection (b)(3)(A) for the initial critical year and ending on the date of the adoption of a rehabilitation plan—”; ####
(3)by redesignating subsections (g), (h), and
(i)as subsections (h), (i), and (j), respectively; and ####
(4)by inserting after subsection
(f)the following: > > ### “(g) Adjustments Disregarded in Withdrawal Liability Determination > > > #### “(1) Benefit reduction > > Any benefit reductions under subsection (e)(8) or
(f)shall be disregarded in determining a plan’s unfunded vested benefits for purposes of determining an employer’s withdrawal liability under section 4201. > > > #### “(2) Surcharges > > Any surcharges under subsection (e)(7) shall be disregarded in determining the allocation of unfunded vested benefits to an employer under section 4211 and in determining the highest contribution rate under section 4219(c), except for purposes of determining the unfunded vested benefits attributable to an employer under section 4211(c)(4) or a comparable method approved under section 4211(c)(5). > > > #### “(3) Contribution increases required by funding improvement or rehabilitation plan > > > ##### “(A) In general > > Any increase in the contribution rate (or other increase in contribution requirements unless due to increased levels of work, employment, or periods for which compensation is provided) that is required or made in order to enable the plan to meet the requirement of the funding improvement plan or rehabilitation plan shall be disregarded in determining the allocation of unfunded vested benefits to an employer under section 4211 and in determining the highest contribution rate under section 4219(c), except for purposes of determining the unfunded vested benefits attributable to an employer under section 4211(c)(4) or a comparable method approved under section 4211(c)(5). > > > ##### “(B) Special rules > > For purposes of this paragraph, any increase in the contribution rate (or other increase in contribution requirements) shall be deemed to be required or made in order to enable the plan to meet the requirement of the funding improvement plan or rehabilitation plan except for increases in contribution requirements due to increased levels of work, employment, or periods for which compensation is provided or additional contributions are used to provide an increase in benefits, including an increase in future benefit accruals, permitted by subsection (d)(1)(B) or (f)(1)(B). > > > #### “(4) Emergence from endangered or critical status > > In the case of increases in the contribution rate (or other increases in contribution requirements unless due to increased levels of work, employment, or periods for which compensation is provided) disregarded pursuant to paragraph (3), this subsection shall cease to apply as of the expiration date of the collective bargaining agreement in effect when the plan emerges from endangered or critical status. Notwithstanding the preceding sentence, once the plan emerges from critical or endangered status, increases in the contribution rate disregarded pursuant to paragraph
(3)shall continue to be disregarded in determining the highest contribution rate under section 4219(c) for plan years during which the plan was in endangered or critical status. > > > #### “(5) Simplified calculations > > The Pension Benefit Guaranty Corporation shall prescribe simplified methods for the application of this subsection in determining withdrawal liability and payment amounts under section 4219(c).” > . ###
(b)Amendments to Internal Revenue Code **[**[26 U.S.C. 432](/us/usc/t26/s432)**]** Section 432 of the Internal Revenue Code of 1986 is amended— ####
(1)in subsection (e), by striking paragraph (9), ####
(2)in subsection (f)— #####
(A)by striking paragraph
(3)and redesignating paragraph
(4)as paragraph (3); and #####
(B)in paragraph
(4)(as redesignated by subparagraph (A)), striking “During the rehabilitation plan adoption period—” and inserting “During the period beginning on the date of the certification under subsection (b)(3)(A) for the initial critical year and ending on the date of the adoption of a rehabilitation plan—”; ####
(3)by redesignating subsections (g), (h), and
(i)as subsections (h), (i), and (j), respectively; and ####
(4)by inserting after subsection
(f)the following: > > ### “(g) Adjustments Disregarded in Withdrawal Liability Determination > > > #### “(1) Benefit reduction > > Any benefit reductions under subsection (e)(8) or
(f)shall be disregarded in determining a plan’s unfunded vested benefits for purposes of determining an employer’s withdrawal liability under section 4201 of the Employee Retirement Income Security Act of 1974. > > > #### “(2) Surcharges > > Any surcharges under subsection (e)(7) shall be disregarded in determining the allocation of unfunded vested benefits to an employer under section 4211 of the Employee Retirement Income Security Act of 1974 and in determining the highest contribution rate under section 4219(c) of such Act, except for purposes of determining the unfunded vested benefits attributable to an employer under section 4211(c)(4) of such Act or a comparable method approved under section 4211(c)(5) of such Act. > > > #### “(3) Contribution increases required by funding improvement or rehabilitation plan > > > ##### “(A) In general > > Any increase in the contribution rate (or other increase in contribution requirements unless due to increased levels of work, employment, or periods for which compensation is provided) that is required or made in order to enable the plan to meet the requirement of the funding improvement plan or rehabilitation plan shall be disregarded in determining the allocation of unfunded vested benefits to an employer under section 4211 of such Act and in determining the highest contribution rate under section 4219(c) of such Act, except for purposes of determining the unfunded vested benefits attributable to an employer under section 4211(c)(4) of such Act or a comparable method approved under section 4211(c)(5) of such Act. > > > ##### “(B) Special rules > > For purposes of this paragraph, any increase in the contribution rate (or other increase in contribution requirements) shall be deemed to be required or made in order to enable the plan to meet the requirement of the funding improvement plan or rehabilitation plan except for increases in contribution requirements due to increased levels of work, employment, or periods for which compensation is provided or additional contributions are used to provide an increase in benefits, including an increase in future benefit accruals, permitted by subsection (d)(1)(B) or (f)(1)(B). > > > #### “(4) Emergence from endangered or critical status > > In the case of increases in the contribution rate (or other increases in contribution requirements unless due to increased levels of work, employment, or periods for which compensation is provided) disregarded pursuant to paragraph (3), this subsection shall cease to apply as of the expiration date of the collective bargaining agreement in effect when the plan emerges from endangered or critical status. Notwithstanding the preceding sentence, once the plan emerges from critical or endangered status, increases in the contribution rate disregarded pursuant to paragraph
(3)shall continue to be disregarded in determining the highest contribution rate under section 4219(c) of such Act for plan years during which the plan was in endangered or critical status. > > > #### “(5) Simplified calculations > > The Pension Benefit Guaranty Corporation shall prescribe simplified methods for the application of this subsection in determining withdrawal liability and payment amounts under section 4219(c) of such Act.” > . ###
(c)Effective Date **[**[26 U.S.C. 432 note](/us/usc/t26/s432)**]** The amendments made by this section shall apply to benefit reductions and increases in the contribution rate or other required contribution increases that go into effect during plan years beginning after December 31, 2014 and to surcharges the obligation for which accrue on or after December 31, 2014.
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Sec. 109
DISREGARD OF CERTAIN CONTRIBUTION INCREASES FOR WITHDRAWAL LIABILITY PURPOSES
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