Allows any individual who has been assigned a Social Security account number, and has been paid wages or has derived self-employment income, to elect to be eligible for the S.A.F.E. account program on or after January 1, 2002. Makes an election ineffective if the individual is entitled to an old age or a disability insurance benefit under the Social Security Act.
Directs the Office of Personnel Management to study and report to the President and the Congress on how to provide for the application of this Act to Federal civilian and military personnel.
Amends the Internal Revenue Code to allow an individual taxpayer a deduction from gross income of the aggregate amount paid in cash during the taxable year by or on behalf of such individual to a S.A.F.E. account. Includes any amount distributed out of a S.A.F.E. account in the distributee's gross income, unless: (1) the account beneficiary has attained age 59-and-a-half; (2) the account beneficiary has died; or (3) the distribution has paid for any qualified long-term health insurance contract, disability insurance, or term life insurance. Makes exceptions for certain other distributions as well. Subjects to an additional tax of 20 percent any account distribution which must be included in gross income. Exempts a S.A.F.E. account from income taxation unless it has terminated according to certain rules. Subjects excess contributions to S.A.F.E. accounts to the same excise tax for excess contributions to individual retirement accounts. Subjects S.A.F.E. accounts also to the excise tax for prohibited transactions.