Title II — Private pension reform

“(14) Starter 401(k) deferral-only plans for employers with no retirement plan

“(A) In general—A starter 401(k) deferral-only arrangement maintained by an eligible employer shall be treated as meeting the requirements of paragraph (3)(A)(ii).

“(B) Starter 401(k) deferral-only arrangement—For purposes of this paragraph, the term starter 401(k) deferral-only arrangement means any cash or deferred arrangement which meets—

“(i) the automatic deferral requirements of subparagraph (C),

“(ii) the contribution limitations of subparagraph (D), and

“(iii) the requirements of subparagraph (E) of paragraph (13).

“(C) Automatic deferral

“(i) In general—The requirements of this subparagraph are met if, under the arrangement, each employee eligible to participate in the arrangement is treated as having elected to have the employer make elective contributions in an amount equal to a qualified percentage of compensation.

“(ii) Election out—The election treated as having been made under clause (i) shall cease to apply with respect to any employee if such employee makes an affirmative election—

“(I) to not have such contributions made, or

“(II) to make elective contributions at a level specified in such affirmative election.

“(iii) Qualified percentage—For purposes of this subparagraph, the term qualified percentage means, with respect to any employee, any percentage determined under the arrangement if such percentage is applied uniformly and is not less than 3 or more than 15 percent.

“(D) Contribution limitations

“(i) In general—The requirements of this subparagraph are met if, under the arrangement—

“(I) the only contributions which may be made are elective contributions of employees described in subparagraph (C), and

“(II) the aggregate amount of such elective contributions which may be made with respect to any employee for any calendar year shall not exceed $8,000.

“(ii) Cost-of-living adjustment—In the case of any calendar year beginning after December 31, 2014, the $8,000 amount under clause (i) shall be adjusted in the same manner as under section 402(g)(4), except that “2013” shall be substituted for “2005”.

“(iii) Cross reference—For catch-up contributions for individuals age 50 or over, see section 414(v)(2)(B)(ii).

“(E) Eligible employer—For purposes of this paragraph—

“(i) In general—The term eligible employer means any employer which, during the first plan year of the cash or deferred arrangement described in subparagraph (B), does not maintain any other qualified plan. An employer treated as an eligible employer under the preceding sentence shall be treated as an eligible employer with respect to the arrangement for any subsequent plan year without regard to whether it maintains another qualified plan.

“(ii) Qualified plan—The term qualified plan means a plan, contract, pension, account, or trust described in subparagraph (A) or (B) of paragraph (5) of section 219(g) (determined without regard to the last sentence of such paragraph (5)).”

“(1) for the first credit year and each of the 2 taxable years immediately following the first credit year, the greater of—

“(A) $500, or

“(B) the lesser of—

“(i) $250 for each employee of the eligible employer who is not a highly compensated employee (as defined in section 415(q)) and who is eligible to participate in the eligible employer plan maintained by the eligible employer, or

“(ii) $5,000, and”

“(11) Replacement of simple retirement accounts with safe harbor plans during plan year

“(A) In general—Subject to the requirements of this paragraph, an employer may elect (in such form and manner as the Secretary may prescribe) at any time during a year to terminate the qualified salary reduction arrangement under paragraph (2), but only if the employer establishes and maintains (as of the day after the termination date) a safe harbor plan to replace the terminated arrangement.

“(B) Combined limits on contributions—The terminated arrangement and safe harbor plan shall both be treated as violating the requirements of paragraph (2)(A)(ii) or section 401(a)(30) (whichever is applicable) if the aggregate elective contributions of the employee under the terminated arrangement during its last plan year and under the safe harbor plan during its transition year exceed the sum of—

“(i) the applicable dollar amount for such arrangement (determined on a full-year basis) with respect to the employee for such last plan year multiplied by a fraction equal to the number of days in such plan year divided by 365, and

“(ii) the applicable dollar amount (as so determined) for such safe harbor plan on such elective contributions during the transition year multiplied by a fraction equal to the number of days in such transition year divided by 365.

“(C) Applicable dollar amount—The applicable dollar amount is the amount determined under paragraph (2)(A)(ii) (after the application of section 414(v)) or section 402(g)(1), whichever is applicable.

“(D) Transition year—For purposes of this paragraph, the transition year is the period beginning after the termination date and ending on the last day of the calendar year during which the termination occurs.

“(E) Safe harbor plan—For purposes of this paragraph, the term safe harbor plan means a qualified cash or deferred arrangement which meets the requirements of paragraph (11), (12), or (13) of section 401(k).”

“(4) Adoption of plan—If an employer adopts a stock bonus, pension, profit-sharing, or annuity plan after the close of a taxable year but before the time prescribed by law for filing the return of the employer for the taxable year (including extensions thereof), the employer may elect to treat the plan as having been adopted as of the last day of the taxable year.”

“(F) Timing of plan amendment for employer making nonelective contributions

“(i) In general—Except as provided in clause (ii), a plan may be amended after the beginning of a plan year to provide that the requirements of subparagraph (C) shall apply to the arrangement for the plan year, but only if the amendment is adopted—

“(I) at any time before the 30th day before the close of the plan year, or

“(II) if the requirements of clause (iii) are met, at any time before the last day under paragraph (8)(A) for distributing excess contributions for the plan year.

“(ii) Exception where plan provided for matching contributions—Clause (i) shall not apply to any plan year if the plan provided at any time during the plan year that the requirements of subparagraph (B) applied to the plan year.

“(iii) 4-percent contribution requirement—Clause (i)(II) shall not apply to an arrangement unless the amount of the contributions described in subparagraph (C) which the employer is required to make under the arrangement for the plan year with respect to any employee is an amount equal to at least 4 percent of the employee's compensation.”

“(F) Timing of plan amendment for employer making nonelective contributions

“(i) In general—Except as provided in clause (ii), a plan may be amended after the beginning of a plan year to provide that the requirements of subparagraph (D)(i)(II) shall apply to the arrangement for the plan year, but only if the amendment is adopted—

“(I) at any time before the 30th day before the close of the plan year, or

“(II) if the requirements of clause (iii) are met, at any time before the last day under paragraph (8)(A) for distributing excess contributions for the plan year.

“(ii) Exception where plan provided for matching contributions—Clause (i) shall not apply to any plan year if the plan provided at any time during the plan year that the requirements of subparagraph (D)(i)(I) applied to the plan year.

“(iii) 4-percent contribution requirement—Clause (i)(II) shall not apply to an arrangement unless the amount of the contributions described in subparagraph (D)(i)(II) which the employer is required to make under the arrangement for the plan year with respect to any employee is an amount equal to at least 4 percent of the employee's compensation.”

“(d) Application of qualification requirements for certain multiple employer plans with designated plan providers

“(1) In general—If a plan to which subsection (c) applies is sponsored by employers that have a common interest other than having adopted the plan, or has a designated plan provider, then, except as provided in paragraph (3), the failure of the portion of the plan covering the employees of an employer maintaining the plan to satisfy any applicable qualification requirement under section 401(a) will not affect the qualification of any portion of the plan covering employees of any employer who has satisfied all such requirements.

“(2) Designated plan provider—For purposes of this subsection—

“(A) In general—The term designated plan provider means the person designated under the terms of the plan as the person responsible to perform all administrative duties which are reasonably necessary to ensure that the plan, and each participating employer, meets the requirements described in paragraph (1), including conducting proper testing of such plan and employers.

“(B) Registration, etc. requirements—A person shall not be treated as a designated plan provider with respect to any plan unless—

“(i) the person registers with the Secretary and provides such identifying information as the Secretary may require, and

“(ii) the person consents to audits by the Secretary at such times as the Secretary determines appropriate to ensure the person is performing the duties described in subparagraph (A).

“(3) Failure by provider to perform duties—If the designated plan provider of a plan does not perform the duties described in paragraph (2)(A) with respect to any plan year so as to reasonably ensure the plan meets the requirements described in paragraph (1)—

“(A) paragraph (1) shall not apply to the plan for the plan year, and

“(B) the determination as to whether the plan, or any participating employer, meets such requirements shall be made in the same manner as made with respect to a plan without a designated plan provider.

“(4) Guidance—The Secretary shall issue such guidance as the Secretary determines appropriate to carry out this subsection, including guidance to—

“(A) identify the administrative duties required to be performed under paragraph (2)(A), and

“(B) require, if appropriate, that the portion of the plan attributable to participating employers not meeting the requirements described in paragraph (1) be spun off to plans maintained by such employers.”

“(3) Discretionary amendments—In the case of an amendment to which paragraphs (1) and (2) do not otherwise apply, the provisions of paragraph (1) shall apply to such amendment if it is to take effect during a plan year and is adopted by the last day prescribed by law (including extensions) for filing the return of tax for the taxable year of the employer within which such plan year ends.”

“(j) Termination

“(1) In general—This section shall not apply to any plan year beginning after December 31, 2013.

“(2) Vesting rules applicable to previously accrued benefits—If a plan was a top-heavy plan for any plan year beginning before January 1, 2014, then, notwithstanding paragraph (1), the vesting rules applicable to the plan under subsection (b) for the plan year shall continue to apply to any accrued benefit derived during the plan year.”

“(G) Amendments to safe harbor plans during plan year

“(i) In general—Except as provided in clause (ii), an amendment to an arrangement to which this paragraph or paragraph (13) applies may take effect during a plan year if it is adopted before the close of the plan year.

“(ii) No reduction in matching contributions—Clause (i) shall not apply to any amendment which reduces the amount of the matching contributions an employer is required to make under the arrangement as in effect before the amendment.”

“(15) Special rules relating to hardship withdrawals—For purposes of paragraph (2)(B)(i)(IV)—

“(A) Amounts which may be withdrawn—The following amounts may be distributed upon hardship of the employee:

“(i) Contributions to a profit-sharing or stock bonus plan to which section 402(e)(3) applies.

“(ii) Qualified nonelective contributions (as defined in subsection (m)(4)(C)).

“(iii) Qualified matching contributions described in paragraph (3)(D)(ii)(I).

“(iv) Earnings on any contributions described in clause (i), (ii), or (iii).

“(B) No requirement to take available loan—A distribution shall not be treated as failing to be made upon the hardship of an employee solely because the employee does not take any available loan under the plan.

“(C) Participation in arrangement not conditioned on whether hardship distribution made—In determining whether a distribution is made upon the hardship of an employee, the Secretary shall not take into account whether or not an employee makes elective or employee contributions under the arrangement for any period after the distribution.”

“(IV) subject to the provisions of paragraph (15), upon hardship of the employee, or”

“(H) Treatment of forfeitures allocated to employee's account—For purposes of this paragraph and paragraph (13), an employer may treat a forfeiture allocated to an employee's account for any plan year as a matching or nonelective contribution made by the employer which is taken into account in determining whether the contribution requirements of this paragraph or paragraph (13), whichever is applicable, are met.”

“(B) Explanation of qualified preretirement survivor annuity—Each plan shall provide to each participant, within a reasonable time after the individual becomes a participant (and consistent with such regulations as the Secretary may prescribe), a written explanation with respect to the qualified preretirement survivor annuity comparable to the explanation required under subparagraph (A). A plan shall be treated as meeting the requirements of this subparagraph if the explanation is included with each summary plan description required to be provided to the participant under section 102 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1022).”

“(B) Each plan shall provide to each participant, within a reasonable time after the individual becomes a participant (and consistent with such regulations as the Secretary of the Treasury may prescribe), a written explanation with respect to the qualified preretirement survivor annuity comparable to the explanation required under subparagraph (A). A plan shall be treated as meeting the requirements of this subparagraph if the explanation is included with each summary plan description required to be provided to the participant under section 102.”

“(H) Requirements may be satisfied through minimum contributions to defined contribution plan

“(i) In general—This paragraph shall not apply to a defined benefit plan of an employer for any plan year if—

“(I) the defined benefit plan is aggregated with a defined contribution plan of the employer for purposes of subsection (a)(4) and section 410(b),

“(II) the defined benefit plan and the defined contribution plan, when so aggregated, meet the requirements of subsection (a)(4) and section 410(b), and

“(III) the contribution requirements of clause (ii) are met with respect to the defined contribution plan.

“(ii) Contribution requirements—The requirements of this clause are met with respect to a defined contribution plan if, under the plan, the employer is required to make nonelective contributions for the applicable plan year of at least 7.5 percent of compensation for a number of employees at least equal to the number of employees which the defined benefit plan would have been required to benefit under this paragraph without regard to this subparagraph. No highly compensated employees (within the meaning of section 414(q)) may be taken into account in determining whether the requirements of this clause are met.

“(iii) Applicable plan year—For purposes of clause (ii), the term applicable plan year means the plan year of the defined contribution plan which ends with or within the plan year of the defined benefit plan to which clause (i) applies.

“(I) Special rules for frozen plans

“(i) Aggregation permitted to satisfy requirements

“(I) In general—Except as provided in subclauses (II) and (III), if a plan is a frozen defined benefit plan for any plan year, an employer may aggregate the plan with any other defined benefit plan or defined contribution plan of the employer for purposes of determining whether the requirements of this paragraph are met with respect to the frozen defined benefit plan.

“(II) Aggregation for other purposes—An employer may not apply subclause (I) unless the employer also aggregates the plans for purposes of subsection (a)(4) and section 410(b).

“(III) Benefits of highly compensated employees disregarded—In the case of any other plan aggregated with a frozen defined benefit plan under subclause (I), accrued benefits of highly compensated employees shall not be taken into account in applying subclause (I).

“(ii) Requirements not to apply in certain cases

“(I) In general—Except as provided in subclause (II), this paragraph shall apply to a frozen defined benefit plan of an employer for any plan year only if the employer maintains any other defined benefit plan during the 6-year period beginning with the first day of the plan year.

“(II) Retroactive application—Clause (i) shall not apply unless the frozen defined benefit plan provides that if the employer establishes or maintains any other defined benefit plan during the 6-year period under subclause (I), each employee (other than a highly compensated employee) shall retroactively accrue benefits under the frozen defined benefit plan for each year of service the employee would have had under the plan during such period (determined as if the employee were one of the employees required to benefit under the plan under this paragraph).

“(iii) Frozen defined benefit plan—For purposes of this subparagraph, the term frozen defined benefit plan means a defined benefit plan which has in effect an amendment that provides that the plan may not accept any new participants after the effective date of the amendment.

“(iv) Highly compensated employee—The term highly compensated employee has the meaning given such term by section 414(q).”

“(D) Treatment of custodial account upon plan termination

“(i) In general—If—

“(I) an employer terminates the plan under which amounts are contributed to a custodial account under subparagraph (A), and

“(II) the person holding the assets of the account has demonstrated to the satisfaction of the Secretary under section 408(a)(2) that the person is qualified to be a trustee of an individual retirement plan,

“(ii) Treatment as Roth IRA—Any custodial account treated as an individual retirement plan under clause (i) shall be treated as a Roth IRA only if the custodial account was a designated Roth account.”

“(16) Alternative method for secure deferral arrangements to meet nondiscrimination requirements

“(A) In general—A secure deferral arrangement shall be treated as meeting the requirements of paragraph (3)(A)(ii).

“(B) Secure deferral arrangement—For purposes of this paragraph, the term secure deferral arrangement means any cash or deferred arrangement which meets the requirements of subparagraphs (C), (D), and (E) of paragraph (13), except as modified by this paragraph.

“(C) Qualified percentage—For purposes of this paragraph, with respect to any employee, the term qualified percentage means, in lieu of the meaning given such term in paragraph (13)(C)(iii), any percentage determined under the arrangement if such percentage is applied uniformly and is—

“(i) at least 6 percent, but not greater than 10 percent, during the period ending on the last day of the first plan year which begins after the date on which the first elective contribution described in paragraph (13)(C)(i) is made with respect to such employee,

“(ii) at least 8 percent during the first plan year following the plan year described in clause (i), and

“(iii) at least 10 percent during any subsequent plan year.

“(D) Matching contributions

“(i) In general—For purposes of this paragraph, an arrangement shall be treated as having met the requirements of paragraph (13)(D)(i) if and only if the employer makes matching contributions on behalf of each employee who is not a highly compensated employee in an amount equal to the sum of 50 percent of the elective contributions of the employee to the extent that such contributions do not exceed 2 percent of compensation plus 30 percent of so much of such contributions as exceed 2 percent but do not exceed 10 percent of compensation.

“(ii) Application of rules for matching contributions—The rules of clause (ii) of paragraph (12)(B) and clauses (iii) and (iv) of paragraph (13)(D) shall apply for purposes of clause (i) but the rule of clause (iii) of paragraph (12)(B) shall not apply for such purposes. The rate of matching contribution for each incremental deferral must be at least as high as the rate specified in clause (i), and may be higher, so long as such rate does not increase as an employee’s rate of elective contributions increases.”

“(13) Alternative method for secure deferral arrangements—A defined contribution plan shall be treated as meeting the requirements of paragraph (2) with respect to matching contributions and employee contributions if the plan—

“(A) is a secure deferral arrangement (as defined in subsection (k)(16)),

“(B) meets the requirements of clauses (ii) and (iii) of paragraph (11)(B), and

“(C) provides that matching contributions on behalf of any employee may not be made with respect to an employee’s contributions or elective deferrals in excess of 10 percent of the employee’s compensation.”

“(38) Portability of lifetime income

“(A) In general—A trust forming part of a defined contribution plan shall not be treated as failing to constitute a qualified trust under this section solely by reason of allowing—

“(i) qualified distributions of a lifetime income investment, or

“(ii) distributions of a lifetime income investment in the form of a qualified plan distribution annuity contract,

“(B) Definitions—For purposes of this subsection—

“(i) the term qualified distribution means a direct trustee-to-trustee transfer to an eligible retirement plan (as defined in section 402(c)(8)(B)), as described in section 401(a)(31)(A),

“(ii) the term lifetime income investment means an investment option that is designed to provide an employee with election rights—

“(I) that are not uniformly available with respect to other investment options under the plan, and

“(II) that are to a lifetime income feature available through a contract or other arrangement offered under the plan or under another eligible retirement plan (as defined in section 402(c)(8)(B)) through a direct trustee-to-trustee transfer to such other eligible retirement plan under section 401(a)(31)(A),

“(iii) the term lifetime income feature means—

“(I) a feature that guarantees a minimum level of income annually (or more frequently) for at least the remainder of the life of the employee or the joint lives of the employee and the employee’s designated beneficiary, or

“(II) an annuity payable on behalf of the employee under which payments are made in substantially equal periodic payments (not less frequently than annually) over the life of the employee or the joint lives of the employee and the employee’s designated beneficiary, taking into account the rules of clause (iii) of section 401(a)(9)(I), and

“(iv) the term qualified plan distribution annuity contract means an annuity contract purchased for a participant and distributed to the participant by a plan described in subparagraph (B) of section 402(c)(8) (without regard to clauses (i) and (ii) thereof).”

“(VI) with respect to amounts invested in a lifetime income investment (as defined in section 401(a)(38)(B)(ii)), the date that is 90 days prior to the date that such lifetime income investment may no longer be held as an investment option under the plan, provided that any distribution under this subclause must be in the form of a qualified distribution (as defined in section 401(a)(38)(B)(i)) or a qualified plan distribution annuity contract (as defined in section 401(a)(38)(B)(iv)), and”

“(iv) in the case of a plan maintained by an employer described in subsection (e)(1)(A), with respect to amounts invested in a lifetime income investment (as defined in section 401(a)(38)(B)(ii)), the date that is 90 days prior to the date that such lifetime income investment may no longer be held as an investment option under the plan, provided that any distribution under this subparagraph must be in the form of a qualified distribution (as defined in section 401(a)(38)(B)(i)) or a qualified plan distribution annuity contract (as defined in section 401(a)(38)(B)(iv)),”

“(F) Exemption for certain annuitized amounts—This paragraph shall not apply to the portion of an employee's entire interest under a defined contribution plan which is invested in a qualified deferred annuity in accordance with the requirements of subsection (o).”

“(o) Rules and definitions relating to investments in qualified deferred annuities

“(1) In general—Subparagraph (F) of subsection (a)(9) shall apply to the portion of an employee's entire interest under the plan invested in a qualified deferred annuity only if—

“(A) the annuity contract is purchased on or before the required beginning date, and

“(B) the investment in the contract does not exceed 25 percent of the employee's entire interest under the plan as of the close of the calendar year preceding the calendar year in which the purchase occurs.

“(2) Exception applies only to 1 annuity—Subparagraph (F) of subsection (a)(9) shall apply only with respect to 1 qualified deferred annuity purchased with a portion of an employee's interest in any plan.

“(3) Qualified deferred annuity—For purposes of subsection (a)(9)(F) and this subsection, the term qualified deferred annuity means an annuity contract—

“(A) which is a commercial annuity (as defined in section 3405(e)(6)) which provides benefits in the form of either—

“(i) a single annuity for the life of the employee under which the annuity payments are substantially equal periodic payments made not less frequently than annually, or

“(ii) a qualified joint and survivor annuity (as defined in section 417(b)) which is the actuarial equivalent of an annuity under clause (i), and

“(B) under which payments are deferred but must commence no later than the date on which the employee attains the age of 85.

“(4) Employee dying before distributions begin—If—

“(A) an employee dies before the distribution of the employee's interest has begun in accordance with subsection (a)(9)(A)(ii) and before the employee has invested in a qualified deferred annuity in accordance with this subsection, and

“(B) the designated beneficiary is the surviving spouse of the employee,

“(5) Special rule for IRAs and 403(b)s—In the case of individual retirement plans and annuity contracts to which the requirements of subsection (a)(9) apply by reason of subsections (a)(6) and (b)(3) of section 408 and section 403(b)(10), the employee may elect to treat all such plans and accounts with the same required beginning date as 1 plan for purposes of applying this subsection.”

“(3) Rollover of minimum required distributions allowed—Section 408(d)(3)(E) shall not apply in determining whether a rollover contribution is a qualified rollover distribution under paragraph (1).”

“(h) Transfer of minimum survivor annuity requirements from plan sponsors to annuity providers

“(1) In general—If a defined contribution plan to which the requirements of section 401(a)(11) and this section apply has a designated annuity provider, then, except as provided in paragraph (3), the designated annuity provider (and not any plan sponsor or administrator) shall be liable for any failure to meet any such requirement.

“(2) Designated annuity provider—For purposes of this subsection, the term designated annuity provider means a person licensed under the laws of any State to issue annuity contracts which has entered into a contract with the plan sponsor or other person who is a fiduciary with respect to the plan to—

“(A) provide annuity contracts to participants and beneficiaries under the plan, and

“(B) meet all requirements under this section and section 401(a)(11) with respect to the providing of such annuities, including providing such annuities in the proper form, providing any notice or written explanations during any applicable notice period, and providing the opportunity for participants and their spouses or beneficiaries to make appropriate elections during any applicable election period.

“(3) Requirement for prudent solicitation and retention of provider—This subsection shall apply to a plan with a designated annuity provider only if the plan sponsor or other person who is a fiduciary with respect to the plan met all requirements for the prudent selection and periodic review of the annuity provider with respect to whom a contract described in paragraph (2) was entered into.

“(4) Authority to charge fees to participants—A plan shall not be treated as failing to meet the requirements of this subsection merely because plan assets are used to pay for reasonable expenses of the designated annuity provider in meeting the requirements described in paragraph (2)(B).

“(5) Electronic notification—The Secretary shall, to the maximum extent practicable, ensure that notices and explanations provided by the designated annuity provider are provided in electronic form.”

“(m) Transfer of minimum survivor annuity requirements from plan sponsors to annuity providers

“(1) In general—If an individual account plan to which the requirements of this section apply has a designated annuity provider, then, except as provided in paragraph (3), the designated annuity provider (and not any plan sponsor or administrator) shall be liable for any failure to meet any such requirement.

“(2) Designated annuity provider—For purposes of this subsection, the term designated annuity provider means a person licensed under the laws of any State to issue annuity contracts which has entered into a contract with the plan sponsor or other person who is a fiduciary with respect to the plan to—

“(A) provide annuity contracts to participants and beneficiaries under the plan, and

“(B) meet all requirements under this section and section 401(a)(11) of the Internal Revenue Code of 1986 with respect to the providing of such annuities, including providing such annuities in the proper form, providing any notice or written explanations during any applicable notice period, and providing the opportunity for participants and their spouses or beneficiaries to make appropriate elections during any applicable election period.

“(3) Requirement for prudent solicitation and retention of provider—This subsection shall apply to a plan with a designated annuity provider only if the plan sponsor or other person who is a fiduciary with respect to the plan met all requirements for the prudent selection and periodic review of the annuity provider with respect to whom a contract described in paragraph (2) was entered into.

“(4) Authority to charge fees to participants—A plan shall not be treated as failing to meet the requirements of this subsection merely because plan assets are used to pay for reasonable expenses of the designated annuity provider in meeting the requirements described in paragraph (2)(B).

“(5) Electronic notification—The Secretary of the Treasury shall, to the maximum extent practicable, ensure that notices and explanations provided by the designated annuity provider are provided in electronic form.”

“112. Electronic communication of pension plan information

“Any document that is required or permitted under this title to be furnished to a plan participant, beneficiary, or other individual with respect to a pension plan may be furnished in electronic form if—

“(1) the system for furnishing such a document—

“(A) is designed to result in access to the document by the participant, beneficiary, or other specified individual through electronic means, including—

“(i) the direct delivery of material to an electronic address of such participant, beneficiary, or individual,

“(ii) the posting of material to a website or other internet or electronic-based information repository to which access has been granted to such participant, beneficiary, or individual, but only if proper notice of the posting has been provided (which may include notice furnished by other electronic means if the content of the notice conveys the need to take action to access the posted material), and

“(iii) other electronic means reasonably calculated to ensure actual receipt of the material by such participant, beneficiary, or individual, and

“(B) protects the confidentiality of personal information relating to such participant's, beneficiary's, or individual's accounts and benefits;

“(2) the participant or beneficiary has not elected to receive a paper version of such document;

“(3) notice is provided to each participant or beneficiary, in electronic or non-electronic form, before a document is furnished electronically, that apprises the individual of the right to elect to receive a paper version of such document; and

“(4) the electronically furnished document—

“(A) is prepared and furnished in a manner that is consistent with the style, format, and content requirements applicable to the particular document; and

“(B) includes a notice that apprises the individual of the significance of the document when it is not otherwise reasonably evident as transmitted.”

“(y) Electronic communication of pension plan information—Any document that is required or permitted under this title to be furnished to a plan participant, beneficiary, or other individual with respect to a pension plan may be furnished in electronic form if—

“(1) the system for furnishing such a document—

“(A) is designed to result in access to the document by the participant, beneficiary, or other specified individual through electronic means, including—

“(i) the direct delivery of material to an electronic address of such participant, beneficiary, or individual,

“(ii) the posting of material to a website or other internet or electronic-based information repository to which access has been granted to such participant, beneficiary, or individual, but only if proper notice of the posting has been provided (which may include notice furnished by other electronic means if the content of the notice conveys the need to take action to access the posted material), and

“(iii) other electronic means reasonably calculated to ensure actual receipt of the material by such participant, beneficiary, or individual, and

“(B) protects the confidentiality of personal information relating to such participant's, beneficiary's, or individual's accounts and benefits;

“(2) the participant or beneficiary has not elected to receive a paper version of such document;

“(3) notice is provided to each participant or beneficiary, in electronic or non-electronic form, before a document is furnished electronically, that apprises the individual of the right to elect to receive a paper version of such document; and

“(4) the electronically furnished document—

“(A) is prepared and furnished in a manner that is consistent with the style, format, and content requirements applicable to the particular document; and

“(B) includes a notice that apprises the individual of the significance of the document when it is not otherwise reasonably evident as transmitted.”

“(1)

“(A) The administrator shall furnish to each participant, and each beneficiary receiving benefits under the plan, a copy of the summary plan description, and all modifications and changes referred to in section 102(a)—

“(i) within 90 days after becoming a participant, or in the case of a beneficiary, within 90 days after first receiving benefits, or

“(ii) if later, within 120 days after the plan becomes subject to this part.

“(B)

“(i) Except as provided in clause (ii), the administrator shall furnish to each participant, and each beneficiary receiving benefits under the plan, every fifth year after the plan becomes subject to this part an updated summary plan description described in section 102 which integrates all plan amendments made within such five-year period, except that in a case where no amendments have been made to a plan during such five-year period, this sentence shall not apply. Notwithstanding the foregoing, the administrator shall furnish to each participant, and to each beneficiary receiving benefits under the plan, the summary plan description described in section 102 every tenth year after the plan becomes subject to this part.

“(ii) In the case of a pension plan, the administrator shall furnish to each participant, and each beneficiary receiving benefits under the plan, 210 days after the end of each remedial plan review period, an updated summary plan description described in section 102 which integrates all plan amendments made during such period, except that if no amendments have been made to a plan during such period, an updated summary plan description shall be furnished not later than 210 days after the end of the subsequent remedial plan review period (without regard to whether plan amendments were made during such subsequent period).

“(C)

“(i) If there is a modification or change described in section 102(a) (other than a material reduction in covered services or benefits provided in the case of a group health plan (as defined in section 733(a)(1))), a summary description of such modification or change shall be furnished not later than 210 days after the end of the plan year in which the change is adopted to each participant, and to each beneficiary who is receiving benefits under the plan.

“(ii) For purposes of clause (i), any amendment to a pension plan adopted during a remedial plan review period shall be treated as adopted in the plan year in which the amendment took effect.

“(D) If there is a modification or change described in section 102(a) that is a material reduction in covered services or benefits provided under a group health plan (as defined in section 733(a)(1)), a summary description of such modification or change shall be furnished to participants and beneficiaries not later than 60 days after the date of the adoption of the modification or change. In the alternative, the plan sponsors may provide such description at regular intervals of not more than 90 days.

“(E) In this paragraph, the term remedial plan review period means, with respect to any pension plan, the period established by the Secretary of the Treasury under the authority of subsection (b) of section 401 of the Internal Revenue Code of 1986 as the regular cycle of review by the Secretary of the Treasury for determining whether the pension plan continues to meet the requirements of such Code for treatment as a qualified plan under subsection (a) of such section 401.”

“(e) Ability of annuity providers To make payments—In the case of the selection of an annuity provider and annuity contract in connection with the payment of benefits under a defined contribution plan, the fiduciary requirement under subsection (a)(1)(B) is deemed satisfied with respect to determining the ability of the annuity provider to make all payments due under the contract to the extent that such payments are guaranteed by a State guaranty association under applicable State law in effect as of the date of issuance of the contract.”