November 1, 1991
TO: PENSION COMMITTEE NO. 34-91
RE: SENATOR ROTH ADDS CONVERSION FEATURE TO IRA PROPOSAL
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Attached is a copy of S. 1865, the Defense Tax Rebate Act,
which was recently introduced by Senator Roth. Title II of S.
1865 includes the IRA provisions of S. 612, which was previously
introduced by Senators Roth and Bentsen. (See Institute
Memorandum to Pension Members No. 10-91 and Members-One Per
Complex No. 12-91, dated March 13, 1991.)
S. 1865 differs from S. 612, however, in that it contains a
provision allowing individuals to convert their existing IRAs
into "back-end" IRAs if they pay income tax on the earnings and
previously deducted contributions. The penalty tax under section
72(t) of the Code would not apply. S. 1865 also would delay the
effective date of the IRA provisions until taxable years
beginning after December 31, 1991.
We will keep you informed of further developments.
Kathy D. Ireland
Associate Counsel - Pension
Attachment