text: SECTION 1. SHORT TITLE; CONSTITUTIONAL AUTHORITY.
  
      (a) Short Title.--This Act may be cited as the ``Homeowner 
  Empowerment Act of 2008''.
      (b) Constitutional Authority To Enact This Legislation.--The 
  constitutional authority upon which this Act rests is the power of 
  Congress to lay and collect taxes, set forth in article I, section 8 of 
  the United States Constitution.
  
  SEC. 2. EXCLUSION FROM GROSS INCOME OF CERTAIN DISTRIBUTIONS FROM 
                QUALIFIED RETIREMENT PLANS USED FOR MORTGAGE PAYMENTS.
  
      (a) In General.--Part III of subchapter B of chapter 1 of the 
  Internal Revenue Code of 1986 is amended by inserting after section 
  139A the following new section:
  
  ``SEC. 139B. CERTAIN DISTRIBUTIONS FROM QUALIFIED RETIREMENT PLANS USED 
                FOR MORTGAGE PAYMENTS.
  
      ``(a) In General.--Gross income shall not include a qualified 
  mortgage distribution.
      ``(b) Limitation.--Subsection (a) shall not apply to any 
  distribution made in any month to the extent that such distribution 
  (when added to all other distributions made in such month which are 
  taken into account under subsection (a) with respect to any individual) 
  exceeds $5,000.
      ``(c) Qualified Mortgage Distribution.--For purposes of this 
  section--
              ``(1) In general.--The term `qualified mortgage 
          distribution' means any distribution which is made before 
          January 1, 2010, from an individual retirement plan, or from 
          amounts attributable to employer contributions made pursuant to 
          elective deferrals described in subparagraph (A) or (C) of 
          section 402(g)(3) or section 501(c)(18)(D)(iii), directly by 
          the trustee of the plan to a mortgagee with respect to a 
          qualified mortgage of any individual. Such term shall not 
          include any distribution to the extent that such distribution 
          exceeds the required minimum payment due under the terms of the 
          mortgage.
              ``(2) Qualified mortgage.--The term `qualified mortgage' 
          means any mortgage which is--
                      ``(A) secured by the principal residence (within 
                  the meaning of section 121) of the mortgagor, and
                      ``(B) originated before January 1, 2008.
      ``(d) Requirement To Repay Distributions.--For purposes of this 
  section--
              ``(1) In general.--The term `qualified mortgage 
          distribution' shall not include any distribution except to the 
          extent that one or more contributions to an individual 
          retirement plan of the taxpayer in an aggregate amount equal to 
          such distribution are made during the 12-year period beginning 
          on the date of such distribution.
              ``(2) Treatment of recontributions.--In the case of any 
          contribution to an individual retirement plan taken into 
          account under paragraph (1)--
                      ``(A) the dollar limitations otherwise applicable 
                  to contributions to individual retirement plans shall 
                  not apply to such contribution, and
                      ``(B) no deduction shall be allowed for such 
                  contribution.
              ``(3) Failure to repay.--In the case of a failure to make 
          the aggregate amount of contributions described in paragraph 
          (1) during the 12-year period described therein with respect to 
          any distribution which would (but for paragraph (1)) be a 
          qualified mortgage distribution, such distribution shall be 
          includible in the gross income of the taxpayer for the taxable 
          year in which such 12-year period ends in lieu of the taxable 
          year in which the distribution was made.''.
      (b) Waiver of 10 Percent Early Withdrawal Penalty Without Regard to 
  Repayment Requirement.--Paragraph (2) of section 72(t) is amended by 
  adding at the end the following new subparagraph:
                      ``(H) Qualified mortgage distributions.--Any 
                  qualified mortgage distribution (as defined in section 
                  139B, but without regard to subsection (d) thereof).''.
      (c) Conforming Amendments.--
              (1) Section 401(k)(2)(B)(i) of such Code is amended by 
          striking ``or'' at the end of subclause (IV), by striking 
          ``and'' at the end of subclause (V) and inserting ``or'', and 
          by inserting after subclause (V) the following new subclause:
                                      ``(VI) in the case of a 
                                  distribution to which section 139B(a) 
                                  applies, the date on which such 
                                  distribution is made, and''.
              (2) Section 403(b)(7)(A)(ii) of such Code is amended by 
          inserting ``or 139B(a)'' after ``section 72(t)(2)(G)''.
              (3) Section 403(b)(11) of such Code is amended by striking 
          ``or'' at the end of subparagraph (B), by striking the period 
          at the end of subparagraph (C) and inserting ``, or'', and by 
          inserting after subparagraph (C) the following new 
          subparagraph:
                      ``(D) for distributions to which section 139B(a) 
                  applies.''.
      (d) Effective Date.--The amendments made by this section shall 
  apply to distributions made after the date of the enactment of this 
  Act.
target: Homeowner Empowerment Act of 2008 - Amends the Internal Revenue Code to: (1) exclude from gross income distributions from individual retirement plans and other qualified retirement plans for payments on the mortgage of a taxpayer's principal residence; (2) require repayments of amounts distributed from such retirement plans over a 12-year period; and (3) waive the 10% penalty on premature distributions from retirement plans for distributions used to pay a mortgage.
feat_title: To amend the Internal Revenue Code of 1986 to exclude from gross income certain distributions from qualified retirement plans used for mortgage payments.