Modify the minimum distribution rules. The tax rules concerning retirement plan distributions (especially the minimum distribution requirements of IRC § 401(a)(9)) are among the most complex in the Code and present numerous traps for the unwary. To avoid a possible 50-percent penalty where a distribution is less than the required minimum, all but the most sophisticated taxpayers must seek professional help to navigate the maze of complicated rules (involving, among other things, the potential for requiring an annual recalculation of the minimum distribution, based on a taxpayer's changing life expectancy from year to year). Further, an ever-growing percentage of Americans are now in or approaching their retirement years, and untold millions of IRA and 401(k) accounts (in addition to traditional pension accounts) will become subject to these rules. Simplification is badly needed.

Although the minimum distribution rules are intended to preclude the unreasonable deferral of benefits, they are not truly needed inasmuch as benefits deferred are subject to income taxation upon eventual distribution and may be subject to estate taxation on a participant's death. Thus, the provisions of IRC § 401(a)(9), other than those dealing with the required start date for distributions, should be replaced with the incidental death benefit rule in effect prior to the enactment of ERISA.