1. Distributions from qualified cash or deferred arrangements allowed in chapter 11 bankruptcy if employee not regularly scheduled for work or paid (a) In general Section 401(k)(2)(B)(i) of the Internal Revenue Code of 1986 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 qualified bankruptcy reorganization delay distribution (as defined in paragraph (15)), the beginning of the period described in paragraph (15)(A)(iii), and . (b) Qualified bankruptcy reorganization delay distribution Section 401(k) of such Code is amended by adding at the end the following new paragraph: (15) Qualified bankruptcy reorganization delay distribution (A) In general For purposes of paragraph (2)(B)(i)(VI), the term qualified bankruptcy reorganization delay distribution means any distribution to an employee if— (i) the employer has filed a case under chapter 11 of title 11, United States Code, and is under the jurisdiction of the court in such case, (ii) such employee, at any time after the filing of such case, is not scheduled to work for at least the number of hours that such employee is customarily scheduled to work or is not paid on or before the time that such employee is customarily paid, and (iii) such distribution is made during the period beginning with the first time which is described in clause (ii) with respect to such employee and ending on the first date thereafter on which such employee is scheduled to work for at least the number of hours that such employee is customarily scheduled to work and is paid at the time such employee is customarily paid (or, if earlier, ending on the date of severance from employment). (B) Limitation on distributions The aggregate amount of distributions received by any employee which may be treated as qualified bankruptcy reorganization delay distributions with respect to any case described in subparagraph (A)(i) shall not exceed the