,,ii  #aac? ,,congress  #a/ ,session    
,s4 #dic  ,,9 ,,! ,,s5ate ,,( ,,!       
,,unit$ ,,/ates  ,m>* #g1 #bjac ,mr4    
,s*um] 7= himself & ,mr4 ,crapo7        
introduc$ ! foll[+ bill2 :i* 0 read     
twice & ref]r$ to ! ,committee on       
,f9ance  ,a ,,bill  ,to am5d ! ,int]nal 
,rev5ue ,code ( #aihf to e/abli% dairy  
f>m sav+s acc\nts1 & = o!r purposes4    
#a4 ,%ort title ,?is ,act may be cit$ z 
! ,dairy ,augm5tation = ,increas$       
,retail 9 ,yogurt products 7,,dairy7    
,act4  #b4 ,e/abli%m5t ( dairy f>m sav+s
 acc\nts  7a7 ,9 g5]al ,"p ,,vii (      
sub*apt] ,b ( *apt] #a ( ! ,int]nal     
,rev5ue ,code ( #aihf is am5d$ by       
r$esignat+ section #bbd z section #bbe &
 by ins]t+ aft] section #bbc ! foll[+   
new section3  #bbd4 ,dairy f>m sav+s    
acc\nts  7a7 ,d$uction all[$ ,9 ! case (
 a qualifi$ dairy f>m]1 !re %all be     
all[$ z a d$uction = ! taxable ye> an   
am\nt equal to ! aggregate am\nt paid 9 
ca% dur+ su* taxable ye> by or on behalf
 ( su* individual to a dairy f>m sav+s  

acc\nt ( su* individual4  7b7 ,acc\nt   
balance limitation ,a d$uction %all n be
 all[$ "u subsection 7a7 ) respect to   
any portion ( a contribution to a dairy 
f>m sav+s acc\nt ( an individual if su* 
contribution w\ld result 9 ! sum ( !    
balances 9 all su* acc\nts ( su*        
individual to exce$ #aej p]c5t ( !      
individual's #c-ye> av]age ( income     
d]iv$ f dairy f>m+4  7c7 ,qualifi$ dairy
 f>m] ,= purposes ( ?is section1 ! t]m  
qualifi$ dairy f>m] means1 ) respect to 
any taxable ye>1 any individual :o1 dur+
 su* ye> 0 engag$ 9 ! trade or bus9ess (
 dairy f>m+4  7d7 ,dairy f>m sav+s      
acc\nt ,= purposes ( ?is section--  7#a7
 ,9 g5]al ,! t]m dairy f>m sav+s acc\nt 
means a tru/ creat$ or organiz$ 9 !     
,unit$ ,/ates z a dairy f>m sav+s acc\nt
 exclusively = ! purpose ( mak+ qualifi$
 di/ributions1 b only if ! writt5 gov]n+
 in/rum5t creat+ ! tru/ meets ! foll[+  
requirem5ts3  7,a7 ,except 9 ! case ( a 
rollov] contribution describ$ 9         
subsection 7f77#d71 no contribution w be

 accept$ unless x is 9 ca%4  7,b7 ,!    
tru/ee is a bank 7z def9$ 9 section     
#djh7n771 an insurance company 7z def9$ 
9 section #haf71 or ano!r p]son :o      
demon/rates to ! satisfaction ( !       
,secret>y t ! mann] 9 :i* su* p]son w   
adm9i/] ! tru/ w be consi/5t ) !        
requirem5ts ( ?is section4  7,c7 ,no "p 
( ! tru/ assets w be inve/$ 9 any?+ o!r 
?an--  7i7 ca%1  7ii7 securities issu$  
by ! ,unit$ ,/ates ,treasury1 or  7iii7 
or su* o!r l[-risk1 int]e/-be>+         
securities z are approv$ by ! ,secret>y4
  7,d7 ,! assets ( ! tru/ w n be comm+l$
 ) o!r prop]ty except 9 a common tru/   
fund or common inve/m5t fund4  7,e7 ,!  
int]e/ ( an individual 9 ! balance 9 8  
acc\nt is non=feitable4  7#b7 ,qualifi$ 
di/ribution ,! t]m qualifi$ di/ribution 
means any am\nt paid f a dairy f>m sav+s
 acc\nt to ! acc\nt b5efici>y to ! ext5t
 t su* am\nt :5 add$ to all o!r am\nts  
paid f su* acc\nts to su* b5efici>y dur+
 ! taxable ye> 7o!r ?an rollov]         
contributions7 does n exce$ ! excess 7if

 any7 (--  7,a7 #ajj p]c5t ( su*        
b5efici>y's #c-ye> av]age ( income d]iv$
 f dairy f>m+1 ov]  7,b7 su* b5efici>y's
 gross income d]iv$ f dairy f>m+ = !    
taxable ye>4  7#c7 #c-,ye> av]age (     
income d]iv$ f dairy f>m+ ,! t]m #c-ye> 
av]age ( income d]iv$ f dairy f>m+      
means1 ) respect to any individual--    
7,a7 ! sum ( ! individual's gross income
 d]iv$ f dairy f>m+ = ! taxable ye> & ! 
#b prec$+ taxable ye>s1 divid$ by  7,b7 
! numb] ( taxable ye>s tak5 into acc\nt 
"u subp>agraph 7,a7 dur+ :i* su*        
individual 0 engag$ 9 ! trade or bus9ess
 ( dairy f>m+4  7#d7 ,acc\nt b5efici>y  
,! t]m acc\nt b5efici>y means !         
individual on ^: behalf ! dairy f>m     
sav+s acc\nt 0 e/abli%$4  7#e7 ,special 
rules2 o!r rules ,rules simil> to !     
foll[+ rules %all apply = purposes ( ?is
 section3  7,a7 ,section #bai7;d77#b7   
7relat+ to no d$uction = rollov]s74     
7,b7 ,section #bai7;f77#c7 7relat+ to "t
 :5 contributions deem$ made74  7,c7    
,section #djh7;g7 7relat+ to community  

prop]ty laws74  7,d7 ,section #djh7;h7  
7relat+ to cu/odial acc\nts74  7e7 ,tax 
treatm5t ( acc\nts  7#a7 ,9 g5]al ,a    
dairy f>m sav+s acc\nt is exempt f      
taxation "u ?is subtitle unless su*     
acc\nt has ceas$ to be a dairy f>m sav+s
 acc\nt4 ,not)/&+ ! prec$+ s5t5ce1 any  
su* acc\nt is subject to ! taxes impos$ 
by section #eaa 7relat+ to imposition ( 
tax on unrelat$ bus9ess income (        
*>itable1 etc4 organizations74  7#b7    
,t]m9ation ( acc\nts ,if ! acc\nt       
b5efici>y ceases to engage 9 ! trade or 
bus9ess ( dairy f>m+--  7,a7 all dairy  
f>m sav+s acc\nts ( su* individual %all 
cease to be su* acc\nts1 &  7,b7 !      
balance ( all su* acc\nts %all be treat$
 z--  7i7 di/ribut$ to su* individual1 &
  7ii7 n paid 9 a qualifi$ di/ribution4 
7#c7 ,prohibit$ transactions2 pl$g+     
acc\nt z security ,rules simil> to !    
rules ( p>agraphs 7#b7 & 7#d7 ( section 
#djh7;e7 %all apply to dairy f>m sav+s  
acc\nts1 & any am\nt treat$ z di/ribut$ 
"u su* rules %all be treat$ z n us$ to  

pay qualifi$ di/ributions4  7f7 ,tax    
treatm5t ( di/ributions  7#a7 ,9 g5]al  
,any am\nt paid or di/ribut$ out ( a    
dairy f>m sav+s acc\nt 7o!r ?an a       
rollov] contribution describ$ 9 p>agraph
 7#d77 %all be includ$ 9 gross income ( 
! acc\nt b5efici>y 9 ! mann] provid$ "u 
section #gb4 ,rules simil> to ! rules ( 
p>agraphs 7#b7 & 7#c77;,h7 ( section    
#djh7;d7 %all apply = purposes ( ?is    
p>agraph4  7#b7 ,additional tax on      
non-qualifi$ di/ributions  7,a7 ,9 g5]al
 ,! tax impos$ by ?is *apt] on ! acc\nt 
b5efici>y = any taxable ye> 9 :i* !re is
 a paym5t or di/ribution f a dairy f>m  
sav+s acc\nt ( su* b5efici>y :i* is n a 
qualifi$ di/ribution %all be increas$ by
 #ae p]c5t ( ! am\nt ( su* paym5t or    
di/ribution :i* is n a qualifi$         
di/ribution4  7,b7 ,exception =         
disability or dea? ,subp>agraph 7,a7    
%all n apply if ! paym5t or di/ribution 
is made aft] ! acc\nt b5efici>y becomes 
disabl$ )9 ! mean+ ( section #gb7m77#g7 
or dies4  7#c7 ,excess contributions    

return$ be=e due date ( return  7,a7 ,9 
g5]al ,if any excess contribution is    
contribut$ = a taxable ye> to a dairy   
f>m sav+s acc\nt ( an individual1       
p>agraph 7#b7 %all n apply to           
di/ributions f ! dairy f>m sav+s acc\nts
 ( su* individual 7to ! ext5t su*       
di/ributions d n exce$ ! aggregate      
excess contributions to all su* acc\nts 
( su* individual = su* ye>7 if--  7i7   
su* di/ribution is receiv$ by !         
individual on or be=e ! la/ day         
prescrib$ by law 7includ+ ext5sions (   
"t7 = fil+ su* individual's return = su*
 taxable ye>1 &  7ii7 su* di/ribution is
 accompani$ by ! am\nt ( net income     
attributable to su* excess contribution4
  ,any net income describ$ 9 clause 7ii7
 %all be includ$ 9 ! gross income ( !   
individual = ! taxable ye> 9 :i* x is   
receiv$4  7,b7 ,excess contribution ,=  
purposes ( subp>agraph 7,a71 ! t]m      
excess contribution means any           
contribution 7o!r ?an a rollov]         
contribution7 :i* is n d$uctible "u ?is 

section4  7#d7 ,rollov] contribution ,an
 am\nt is describ$ 9 ?is p>agraph z a   
rollov] contribution if x meets !       
requirem5ts ( subp>agraphs 7,a7 & 7,b74 
7,a7 ,9 g5]al ,= purposes ( ?is section1
 any am\nt paid or di/ribut$ f a dairy  
f>m sav+s acc\nt to ! acc\nt b5efici>y  
%all be treat$ z a qualifi$ di/ribution 
to ! ext5t ! am\nt receiv$ is paid into 
a dairy f>m sav+s acc\nt = ! b5efit (   
su* b5efici>y n lat] ?an ! #fj? day aft]
 ! day on :i* ! b5efici>y receives !    
paym5t or di/ribution4  7,b7 ,limitation
 ,?is p>agraph %all n apply to any am\nt
 describ$ 9 subp>agraph 7,a7 receiv$ by 
an individual f a dairy f>m sav+s acc\nt
 if1 at any "t dur+ ! #a-ye> p]iod end+ 
on ! day ( su* receipt1 su* individual  
receiv$ any o!r am\nt describ$ 9        
subp>agraph 7,a7 f a dairy f>m sav+s    
acc\nt :i* 0 n includ$ 9 ! individual's 
gross income because ( ! application (  
?is p>agraph4  7#e7 ,transf] ( acc\nt   
incid5t to divorce ,! transf] ( an      
individual's int]e/ 9 a dairy f>m sav+s 

acc\nt to an individual's sp\se or =m]  
sp\se "u a divorce or sep>ation in/rum5t
 describ$ 9 subp>agraph 7,a7 ( section  
#ga7;b77#b7 %all n be consid]$ a taxable
 transf] made by su* individual not)/&+ 
any o!r provision ( ?is subtitle1 & su* 
int]e/ %all1 aft] su* transf]1 be treat$
 z a dairy f>m sav+s acc\nt ) respect to
 :i* su* sp\se is ! acc\nt b5efici>y4   
7#f7 ,treatm5t aft] dea? ( acc\nt       
b5efici>y  7,a7 ,treatm5t if designat$  
b5efici>y is sp\se ,if ! acc\nt         
b5efici>y's surviv+ sp\se acquires su*  
b5efici>y's int]e/ 9 a dairy f>m sav+s  
acc\nt by reason ( be+ ! designat$      
b5efici>y ( su* acc\nt at ! dea? ( !    
acc\nt b5efici>y1 su* dairy f>m sav+s   
acc\nt %all be treat$ z if ! sp\se 7 !  
acc\nt b5efici>y4  7,b7 ,o!r cases  7i7 
,9 g5]al ,if1 by reason ( ! dea? ( !    
acc\nt b5efici>y1 any p]son acquires !  
acc\nt b5efici>y's int]e/ 9 a dairy f>m 
sav+s acc\nt 9 a case to :i* subp>agraph
 7,a7 does n apply--  7,i7 su* acc\nt   
%all cease to be a dairy f>m sav+s      

acc\nt z ( ! date ( dea?1 &  7,,ii7 an  
am\nt equal to ! fair m>ket value ( !   
assets 9 su* acc\nt on su* date %all be 
includ$ if su* p]son is n ! e/ate ( su* 
b5efici>y1 9 su* p]son's gross income = 
! taxable ye> :i* includes su* date1 or 
if su* p]son is ! e/ate ( su* b5efici>y1
 9 su* b5efici>y's gross income = ! la/ 
taxable ye> ( su* b5efici>y4  7ii7      
,d$uction = e/ate taxes ,an appropriate 
d$uction %all be all[$ "u section       
#fia7;c7 to any p]son 7o!r ?an ! dec$5t 
or ! dec$5t's sp\se7 ) respect to am\nts
 includ$ 9 gross income "u clause 7i7 by
 su* p]son4  7g7 ,reports ,! ,secret>y  
may require ! tru/ee ( a dairy f>m sav+s
 acc\nt to make su* reports reg>d+ su*  
acc\nt to ! ,secret>y & to ! acc\nt     
b5efici>y ) respect to contributions1   
di/ributions1 & su* o!r matt]s z !      
,secret>y det]m9es appropriate4 ,!      
reports requir$ by ?is subsection %all  
be fil$ at su* "t & 9 su* mann] &       
furni%$ to su* individuals at su* "t & 9
 su* mann] z may be requir$ by !        

,secret>y4  4  7b7 ,d$uction all[$ :e!r 
or n individual itemizes o!r d$uctions  
,subsection 7a7 ( section #fb ( su*     
,code is am5d$ by ins]t+ aft] p>agraph  
7#ba7 ! foll[+ new p>agraph3  7#bb7     
,dairy f>m sav+s acc\nts ,! d$uction    
all[$ by section #bbd4  4  7c7 ,tax on  
excess contributions ,section #digc (   
su* ,code 7relat+ to tax on excess      
contributions to c]ta9 tax-favor$       
acc\nts & annuities7 is am5d$--  7#a7 by
 /rik+ or at ! end ( subsection 7a77#d71
 by ins]t+ or at ! end ( subsection     
7a77#e71 & by ins]t+ aft] subsection    
7a77#e7 ! foll[+ new p>agraph3  7#f7 a  
dairy f>m sav+s acc\nt 7)9 ! mean+ (    
section #bbd7;d771  2 &  7#b7 by add+ at
 ! end ! foll[+ new subsection3  7h7    
,excess contributions to dairy f>m sav+s
 acc\nts ,= purposes ( ?is section1 9 ! 
case ( dairy f>m sav+s acc\nts 7)9 !    
mean+ ( section #bbd7;d771 ! t]m excess 
contribution means ! sum (--  7#a7 !    
aggregate am\nt contribut$ = ! taxable  
ye> to ! acc\nts 7o!r ?an rollov]       

contributions describ$ 9 section        
#bbd7;f77#d77 :i* is n all[able z a     
d$uction "u section #bbd = su* ye>1 &   
7#b7 ! am\nt det]m9$ "u ?is subsection =
 ! prec$+ taxable ye>1 r$uc$ by ! sum   
(--  7,a7 ! di/ributions out ( ! acc\nts
 ) respect to :i* additional tax 0      
impos$ "u section #bbd7;f77#b71 &  7,b7 
! excess 7if any7 (--  7i7 ! maximum    
am\nt all[able z a d$uction "u section  
#bbd7;b7 = ! taxable ye>1 ov]  7ii7 !   
am\nt contribut$ to ! acc\nts = !       
taxable ye>4  ,= purposes ( ?is         
subsection1 any contribution :i* is     
di/ribut$ out ( ! dairy f>m sav+s acc\nt
 9 a di/ribution to :i* section         
#bbd7;f77#c7 applies %all be treat$ z an
 am\nt n contribut$4  4  7d7 ,tax on    
prohibit$ transactions  7#a7 ,section   
#dige7;c7 ( su* ,code 7relat+ to tax on 
prohibit$ transactions7 is am5d$ by add+
 at ! end ! foll[+ new p>agraph3  7#g7  
,special rule = dairy f>m sav+s acc\nts 
,an individual = ^: b5efit a dairy f>m  
sav+s acc\nt 7)9 ! mean+ ( section      

#bbd7;d77 is e/abli%$ %all be exempt f !
 tax impos$ by ?is section ) respect to 
any transaction conc]n+ su* acc\nt 7:i* 
w\ld o!rwise be taxable "u ?is section7 
if1 ) respect to su* transaction1 !     
acc\nt ceases to be a dairy f>m sav+s   
acc\nt by reason ( ! application (      
section #bbd7;e77#b7 to su* acc\nt4  4  
7#b7 ,section #dige7;e77#a7 ( su* ,code 
is am5d$ by r$esignat+ subp>agraphs 7,f7
 & 7,g7 z subp>agraphs 7,g7 & 7,h71     
respectively1 & by ins]t+ aft]          
subp>agraph 7,e7 ! foll[+ new           
subp>agraph3  7,f7 a dairy f>m sav+s    
acc\nt describ$ 9 section #bbd7;d71  4  
7e7 ,failure ,to provide reports on     
dairy f>m sav+s acc\nts ,section        
#ffic7;a77#b7 ( su* ,code 7relat+ to    
reports7 is am5d$ by r$esignat+         
subp>agraphs 7,d7 & 7,e7 z subp>agraphs 
7,e7 & 7,f71 respectively1 & by ins]t+  
aft] subp>agraph 7,c7 ! foll[+ new      
subp>agraph3  7,d7 section #bbd7;g7     
7relat+ to dairy f>m sav+s acc\nts71  4 
7f7 ,cl]ical am5dm5t ,! table ( sections

 = "p ,,vii ( sub*apt] ,b ( *apt] #a (  
su* ,code is am5d$ by r$esignat+ ! item 
relat+ to section #bbd z relat+ to      
section #bbe & by ins]t+ aft] ! item    
relat+ to section #bbc ! foll[+3  ,sec4 
#bbd4 ,dairy f>m sav+s acc\nts4  4  7g7 
,effective date ,! am5dm5ts made by ?is 
section %all apply to taxable ye>s end+ 
aft] ! date ( ! enactm5t ( ?is ,act4