article: SECTION 1. SHORT TITLE. This Act may be cited as the ``Securing Tomorrow by Saving Today Act of 2009''. SEC. 2. EXEMPTION OF CERTAIN INTEREST INCOME FROM TAX. (a) In General.--Part III of subchapter B of chapter 1 of the Internal Revenue Code of 1986 (relating to amounts specifically excluded from gross income) is amended by inserting after section 115 the following new section: ``SEC. 116. PARTIAL EXCLUSION OF INTEREST RECEIVED BY INDIVIDUALS. ``(a) Exclusion From Gross Income.--Gross income does not include interest otherwise includible in gross income which is received during the taxable year by an individual. ``(b) Limitations.-- ``(1) Maximum amount.--The aggregate amount excluded under subsection (a) for any taxable year shall not exceed-- ``(A) in the case of any taxable year beginning in 2009, $500 ($1,000 in the case of a joint return), and ``(B) in the case of taxable years beginning after 2009-- ``(i) in the case of a joint return, 200 percent of the dollar amount in effect under clause (ii) for the taxable year, and ``(ii) in any other case, $550. ``(2) Inflation adjustment.--In the case of any taxable year beginning after 2010, the $550 amount contained in paragraph (1)(B)(ii) shall be increased by an amount equal to-- ``(A) such dollar amount, multiplied by ``(B) the cost-of-living adjustment determined under section 1(f)(3) for such calendar year by substituting `calendar year 2009' for `calendar year 1992' in subparagraph (B) thereof. If any increase under the preceding sentence is not a multiple of $10, such increase shall be rounded to the nearest multiple of $10. ``(c) Interest.--For purposes of this section, the term `interest' means-- ``(1) interest on deposits with a bank (as defined in section 581), ``(2) amounts (whether or not designated as interest) paid in respect of deposits, investment certificates, or withdrawable or repurchasable shares, by-- ``(A) a mutual savings bank, cooperative bank, domestic building and loan association, industrial loan association or bank, or credit union, or ``(B) any other savings or thrift institution which is chartered and supervised under Federal or State law, the deposits or accounts in which are insured under Federal or State law or which are protected and guaranteed under State law. ``(d) Certain Nonresident Aliens Ineligible for Exclusion.--For purposes of this section, in the case of a nonresident alien individual, subsection (a) shall apply only in determining the taxes imposed for the taxable year pursuant to sections 871(b)(1) and 877(b).''. (b) Conforming Amendments.-- (1) Subparagraph (A) of section 32(i)(2) of such Code is amended by inserting ``(determined without regard to section 116)'' before the comma. (2) Subparagraph (B) of section 86(b)(2) of such Code is amended to read as follows: ``(B) increased by the sum of-- ``(i) the amount of interest received or accrued by the taxpayer during the taxable year which is exempt from tax, and ``(ii) the amount of interest received during the taxable year which is excluded from gross income under section 116.''. (3) Subsection (d) of section 135 of such Code is amended by redesignating paragraph (4) as paragraph (5) and by inserting after paragraph (3) the following new paragraph: ``(4) Coordination with section 116.--This section shall be applied before section 116.''. (4) Paragraph (2) of section 265(a) of such Code is amended by inserting before the period ``, or to purchase or carry obligations or shares, or to make deposits, to the extent the interest thereon is excludable from gross income under section 116''. (5) Subsection (c) of section 584 of such Code is amended by adding at the end the following new flush sentence: ``The proportionate share of each participant in the amount of interest received by the common trust fund and to which section 116 applies shall be considered for purposes of such section as having been received by such participant.''. (6) Subsection (a) of section 643 of such Code is amended by redesignating paragraph (7) as paragraph (8) and by inserting after paragraph (6) the following new paragraph: ``(7) Interest.--There shall be included the amount of any interest excluded from gross income pursuant to section 116.''. (7) The table of sections for part III of subchapter B of chapter 1 of such Code is amended by inserting after the item relating to section 115 the following new item: ``Sec. 116. Partial exclusion of dividends and interest received by individuals.''. (c) Effective Date.--The amendments made by this section shall apply to taxable years beginning after December 31, 2008. SEC. 3. INCREASE IN DOLLAR LIMITATIONS ON CONTRIBUTIONS TO RETIREMENT PLANS. (a) Permanent Increase in Dollar Limitation on Deduction for Contributions to Individual Retirement Plans.-- (1) In general.--Paragraph (5) of section 219(b) of the Internal Revenue Code of 1986 is amended-- (A) by amending subparagraph (A) to read as follows: ``(A) In general.--The deductible amount for any taxable year is the applicable dollar amount in effect under section 402(g)(1) for such taxable year.'', and (B) by striking subparagraph (D). (2) Simple retirement accounts.--Subparagraph (E) of section 408(p)(2) of such Code is amended to read as follows: ``(E) Applicable dollar amount.--For purposes of subparagraph (A)(ii), the applicable dollar amount for any taxable year is the applicable dollar amount in effect under section 402(g)(1) for such taxable year.''. (b) Temporary Increase in Contributions to Defined Contribution Plans.-- (1) Increase in limitation on elective deferrals.-- Paragraph (1) of section 402(g) of such Code is amended by adding at the end the following new subparagraph: ``(D) Temporary increase in applicable dollar amount.--In the case of taxable years beginning in calendar year 2009, 2010, or 2011, the applicable dollar amount determined under subparagraph (B) shall not be less than $33,000.''. (2) Increase in combined employee and employer limitation on contributions to defined contribution plans.--Paragraph 1 of section 415(c) of such Code is amended by adding at the end the following new flush sentence: ``In the case of taxable years beginning in calendar year 2009, 2010, or 2011, the dollar amount in effect under subparagraph (A) shall not be less than $65,500.''. (c) Effective Date.--The amendments made by this section shall apply to taxable years beginning after December 31, 2008. SEC. 4. INCREASE IN PERMITTED CATCH-UP CONTRIBUTIONS TO RETIREMENT PLANS. (a) Temporary Increase in Permitted Catch-Up Contributions.-- (1) In general.--Paragraph (2) of section 414(v) of such Code is amended by adding at the end the following new subparagraph: ``(E) Temporary increase in permitted catch-up contributions.--In the case of taxable years beginning in calendar year 2009, 2010, or 2011, the dollar amount in effect under subparagraph (A) shall not be less than $10,000.''. (2) Individual retirement plans.--Subparagraph (B) of section 219(b)(5) of such Code is amended by adding at the end the following new clause: ``(iii) Special rule for 2009 through 2011.--In the case of taxable years beginning in calendar years 2009, 2010, or 2011, the dollar amount in effect under clause (i) shall not be less than $10,000.''. (b) Effective Date.--The amendments made by this section shall apply to taxable years beginning after December 31, 2008. SEC. 5. SUSPENSION OF MINIMUM DISTRIBUTION REQUIREMENTS. (a) In General.--In the case of an eligible defined contribution plan of an individual, sections 401(a)(9), 404(a)(2), 403(b)(10), 408(a)(6), 408(b)(3), and 457(d)(2) of the Internal Revenue Code of 1986 shall not apply with respect to such individual for any year during the suspension period. (b) Suspension Period.--For purposes of this section, the term ``suspension period'' means the period beginning on January 1, 2008, and ending on December 31, 2012. (c) Eligible Defined Contribution Plan.--For purposes of this section, the term ``eligible defined contribution plan'' means-- (1) a defined contribution plan (within the meaning of section 414(i) of such Code) which is-- (A) an employee's trust described in section 401(a) of such Code which is exempt from tax under section 501(a) of such Code, (B) an annuity plan described in section 403(a) of such Code, (C) an annuity contract described in section 403(b) of such Code, and (D) an eligible deferred compensation plan described in section 457(b) of such Code which is maintained by an eligible employer described in section 457(e)(1)(A) of such Code, and (2) an individual retirement plan (as defined in section 7701(a)(37) of such Code). (d) Special Rules.-- (1) Required beginning date during suspension period.--The required beginning date with respect to any individual under section 401(a)(9) of such Code shall be determined without regard to this section for purposes of applying sections 401(a)(9), 404(a)(2), 403(b)(10), 408(a)(6), 408(b)(3), and 457(d) of such Code for calendar years after 2009. (2) Exception for 5-year rule.--In the case of a distribution required under section 401(a)(9)(B)(ii) of such Code, subsection (a) shall not apply. (3) Exemption of distributions during suspension period from trustee transfer and withholding rules.--For purposes of sections 401(a)(31), 402(f), and 3405 of such Code, any distribution during the suspension period which, but for subsection (a), would have been a required distribution under section 401(a)(9) of such Code shall not be treated as an eligible rollover distribution. (e) Provisions Relating to Plan Amendments.-- (1) In general.--If this subsection applies to any plan or annuity contract, such plan or contract shall be treated as being operated in accordance with the terms of the plan during the period described in paragraph (2)(B)(i). (2) Amendments to which subsection applies.-- (A) In general.--This subsection shall apply to any amendment to any plan or annuity contract which is made-- (i) pursuant to this section or pursuant to any regulation issued by the Secretary of the Treasury to carry out this section, and (ii) on or before the last day of the first plan year beginning on or after January 1, 2009. (B) Conditions.--This subsection shall not apply to any amendment unless during the period beginning on the date such amendment takes effect and ending on December 31, 2009 (or, if earlier, the date the plan or contract amendment is adopted), the plan or contract is operated as if such plan or contract amendment were in effect. (f) Effective Date.--This section shall take effect on the date of the enactment of this Act.
summary: Securing Tomorrow by Saving Today Act of 2009 - Amends the Internal Revenue Code to: (1) allow an exclusion from gross income of interest earned on deposits with certain financial institutions; (2) allow increased contributions, including catch-up contributions, to retirement plans in 2009, 2010, and 2011; and (3) suspend minimum distribution requirements from tax-deferred pension plans and individual retirement accounts between 2008 and 2013.