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Page 1168 TITLE 26—INTERNAL REVENUE CODE § 408A § 408A TITLE 26—INTERNAL REVENUE CODE Page 1168 PLAN AMENDMENTS NOT REQUIRED UNTIL (3) Limits based on modified adjusted gross in- JANUARY 1, 1989 come For provisions directing that if any amendments (A) Dollar limit made by subtitle A or subtitle C of title XI [§§ 1101–1147 and 1171–1177] or title XVIII [§§ 1800–1899A] of Pub. L. The amount determined under paragraph 99–514 require an amendment to any plan, such plan (2) for any taxable year shall not exceed an amendment shall not be required to be made before the amount equal to the amount determined first plan year beginning on or after Jan. 1, 1989, see under paragraph (2)(A) for such taxable year, section 1140 of Pub. L. 99–514, as amended, set out as a reduced (but not below zero) by the amount note under section 401 of this title. which bears the same ratio to such amount TRANSITIONAL RULE FOR CONTRIBUTIONS FOR TAXABLE as— YEARS BEGINNING BEFORE JANUARY 1, 1978 (i) the excess of— (I) the taxpayer’s adjusted gross in- Section 157(c)(2)(B) of Pub. L. 95–600, as amended by Pub. L. 99–514, § 2, Oct. 22, 1986, 100 Stat. 2095, provided come for such taxable year, over that: ‘‘In the case of contributions for taxable years be- (II) the applicable dollar amount, bears ginning before January 1, 1978, paragraph (5) of section to 408(d) of the Internal Revenue Code of 1986 [formerly (ii) $15,000 ($10,000 in the case of a joint I.R.C. 1954] shall be applied as if such paragraph did not contain any dollar limitation.’’ return or a married individual filing a sep- arate return). EXCHANGE OF FIXED PREMIUM ANNUITY OR ENDOWMENT CONTRACT ISSUED ON OR BEFORE NOV. 6, 1978, FOR The rules of subparagraphs (B) and (C) of INDIVIDUAL RETIREMENT ANNUITY section 219(g)(2) shall apply to any reduction under this subparagraph. Section 157(d)(3) of Pub. L. 95–600, as amended by Pub. L. 99–514, § 2, Oct. 22, 1986, 100 Stat. 2095, provided that: (B) Definitions ‘‘In the case of any annuity or endowment contract is- For purposes of this paragraph— sued on or before the date of the enactment of this Act (i) adjusted gross income shall be deter- [Nov. 6, 1978] which would be an individual retirement annuity within the meaning of section 408(b) of the In- mined in the same manner as under sec- ternal Revenue Code of 1986 [formerly I.R.C. 1954] (as tion 219(g)(3), except that any amount in- amended by paragraph (1) [amending subsec. (b)(2) of cluded in gross income under subsection this section]) but for the fact that the premiums under (d)(3) shall not be taken into account, and the contract are fixed, at the election of the taxpayer (ii) the applicable dollar amount is— an exchange before January 1, 1981, of that contract for (I) in the case of a taxpayer filing a an individual retirement annuity within the meaning joint return, $150,000, of such section 408(b) (as amended by paragraph (1)) (II) in the case of any other taxpayer shall be treated as a nontaxable exchange which does not constitute a distribution.’’ (other than a married individual filing a separate return), $95,000, and § 408A. Roth IRAs (III) in the case of a married individual filing a separate return, zero. (a) General rule (C) Marital status Except as provided in this section, a Roth IRA shall be treated for purposes of this title in the Section 219(g)(4) shall apply for purposes of same manner as an individual retirement plan. this paragraph. (b) Roth IRA (D) Inflation adjustment For purposes of this title, the term ‘‘Roth In the case of any taxable year beginning IRA’’ means an individual retirement plan (as in a calendar year after 2006, the dollar defined in section 7701(a)(37)) which is des- amounts in subclauses (I) and (II) of sub- ignated (in such manner as the Secretary may paragraph (B)(ii) shall each be increased by prescribe) at the time of establishment of the an amount equal to— plan as a Roth IRA. Such designation shall be (i) such dollar amount, multiplied by made in such manner as the Secretary may pre- (ii) the cost-of-living adjustment deter- scribe. mined under section 1(f)(3) for the calendar year in which the taxable year begins, de- (c) Treatment of contributions termined by substituting ‘‘calendar year (1) No deduction allowed 2005’’ for ‘‘calendar year 1992’’ in subpara- No deduction shall be allowed under section graph (B) thereof. 219 for a contribution to a Roth IRA. Any increase determined under the preced- (2) Contribution limit ing sentence shall be rounded to the nearest The aggregate amount of contributions for multiple of $1,000. any taxable year to all Roth IRAs maintained (4) Contributions permitted after age 701⁄2 for the benefit of an individual shall not ex- Contributions to a Roth IRA may be made ceed the excess (if any) of— even after the individual for whom the ac- (A) the maximum amount allowable as a count is maintained has attained age 701⁄2. deduction under section 219 with respect to such individual for such taxable year (com- (5) Mandatory distribution rules not to apply puted without regard to subsection (d)(1) or before death (g) of such section), over Notwithstanding subsections (a)(6) and (b)(3) (B) the aggregate amount of contributions of section 408 (relating to required distribu- for such taxable year to all other individual tions), the following provisions shall not apply retirement plans (other than Roth IRAs) to any Roth IRA: maintained for the benefit of the individual. (A) Section 401(a)(9)(A). Page 1169 TITLE 26—INTERNAL REVENUE CODE § 408A (B) The incidental death benefit require- quired to be included in gross income for ments of section 401(a). any taxable year beginning in 2010 by rea- (6) Rollover contributions son of this paragraph shall be so included ratably over the 2-taxable-year period be- (A) In general ginning with the first taxable year begin- No rollover contribution may be made to a ning in 2011. Roth IRA unless it is a qualified rollover contribution. Any election under clause (iii) for any dis- tributions during a taxable year may not be (B) Coordination with limit changed after the due date for such taxable A qualified rollover contribution shall not year. be taken into account for purposes of para- (B) Distributions to which paragraph applies graph (2). This paragraph shall apply to a distribu- (7) Time when contributions made tion from an eligible retirement plan (as de- For purposes of this section, the rule of sec- fined by section 402(c)(8)(B)) maintained for tion 219(f)(3) shall apply. the benefit of an individual which is contrib- (d) Distribution rules uted to a Roth IRA maintained for the bene- fit of such individual in a qualified rollover For purposes of this title— contribution. This paragraph shall not apply (1) Exclusion to a distribution which is a qualified roll- Any qualified distribution from a Roth IRA over contribution from a Roth IRA or a shall not be includible in gross income. qualified rollover contribution from a des- ignated Roth account which is a rollover (2) Qualified distribution contribution described in section For purposes of this subsection— 402A(c)(3)(A) 1 (A) In general (C) Conversions The term ‘‘qualified distribution’’ means The conversion of an individual retirement any payment or distribution— plan (other than a Roth IRA) to a Roth IRA (i) made on or after the date on which shall be treated for purposes of this para- the individual attains age 591⁄2, graph as a distribution to which this para- (ii) made to a beneficiary (or to the es- graph applies. tate of the individual) on or after the (D) Additional reporting requirements death of the individual, (iii) attributable to the individual’s Trustees of Roth IRAs, trustees of individ- being disabled (within the meaning of sec- ual retirement plans, persons subject to sec- tion 72(m)(7)), or tion 6047(d)(1), or all of the foregoing per- (iv) which is a qualified special purpose sons, whichever is appropriate, shall include distribution. such additional information in reports re- quired under section 408(i) or 6047 as the Sec- (B) Distributions within nonexclusion period retary may require to ensure that amounts A payment or distribution from a Roth required to be included in gross income IRA shall not be treated as a qualified dis- under subparagraph (A) are so included. tribution under subparagraph (A) if such (E) Special rules for contributions to which payment or distribution is made within the 2-year averaging applies 5-taxable year period beginning with the first taxable year for which the individual In the case of a qualified rollover contribu- made a contribution to a Roth IRA (or such tion to a Roth IRA of a distribution to which individual’s spouse made a contribution to a subparagraph (A)(iii) applied, the following Roth IRA) established for such individual. rules shall apply: (C) Distributions of excess contributions and (i) Acceleration of inclusion earnings (I) In general The term ‘‘qualified distribution’’ shall The amount otherwise required to be not include any distribution of any contribu- included in gross income for any taxable tion described in section 408(d)(4) and any year beginning in 2010 or the first tax- net income allocable to the contribution. able year in the 2-year period under sub- (3) Rollovers from an eligible retirement plan paragraph (A)(iii) shall be increased by other than a Roth IRA the aggregate distributions from Roth IRAs for such taxable year which are al- (A) In general locable under paragraph (4) to the por- Notwithstanding sections 402(c), 403(b)(8), tion of such qualified rollover contribu- 408(d)(3), and 457(e)(16), in the case of any tion required to be included in gross in- distribution to which this paragraph ap- come under subparagraph (A)(i).
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