July 31, 1991
TO: PENSION COMMITTEE NO. 21-91
RE: 457 PLAN LEGISLATION INTRODUCED
__________________________________________________________
Attached is a copy of H.R. 2906, a bill to amend the
provisions of Internal Revenue Code section 457, together with
the accompanying Record statement.
Under current law, employees of state and local governments
and certain employees of tax-exempt organizations may defer up to
$7,500 annually to a 457 plan. The bill would apply cost of
living adjustments to 457 plans to align them more with 401(k)
plans and 403(b) arrangements. The bill would also permit de
minimus pre-retirement distributions up to $3,500 from a 457 plan
for inactive participants.
The bill may be considered with pension simplification
legislation introduced this year. We will keep you informed of
developments.
W. Richard Mason
Assistant Counsel - Pension
Attachment