112th Congress

Savings for American Families’ Future Act of 2012

Introduced as HR 6472 by Representative Richard Neal (D-MA) in the 112th Congress on Sep 20, 2012.

Amends the Internal Revenue Code to: (1) increase the rate of the tax credit for retirement savings contributions, (2) make such credit refundable, and (3) direct the Secretary of the Treasury to pay matching credit amounts into taxpayer retirement accounts.

Source: Congress.gov. Bill summary authored by the Congressional Research Service.

 

Automatic IRA Act of 2012

Introduced as HR 4049 by Representative Richard Neal (D-MA) in the 112th Congress on February 16, 2012.

Amends the Internal Revenue Code to: (1) require certain employers who do not maintain qualifying retirement plans or arrangements to make available to their eligible employees a payroll deposit individual retirement account (IRA) arrangement (automatic IRA arrangement) which grants such employees the right to opt-out of participation; (2) require the Secretary of the Treasury to provide employers with a model notice for notifying employees of their opportunity to participate in such an arrangement and to provide participants with an annual statement setting forth arrangement payments, earnings, value, and other specified information; (3) impose a penalty on employers who fail to provide eligible employees access to such an arrangement; (4) establish an Automatic IRA Advisory Group to make recommendations regarding investment options; and (5) allow employers who do not have more than 100 employees a tax credit for costs associated with establishing an automatic IRA arrangement.

Requires the Secretary and the Secretary of Labor to jointly conduct feasibility studies on: (1) extending spousal consent requirements to automatic IRA arrangements; (2) promoting the use of low-cost lifetime income arrangements, (3) automatically transferring amounts saved by employees in retirement bonds into alternative, private sector, diversified investments when employees’ automatic IRA balances reach a certain dollar level; (4) using investment data to notify individuals with multiple small balance retirement accounts of consolidation options; and (5) using investment arrangements associated with automatic IRAs to assist in addressing the problem of abandoned accounts.

Source: Congress.gov. Bill summary authored by the Congressional Research Service.

 

Retirement Plan Simplification and Enhancement Act of 2012

Introduced as HR 4050 by Representative Richard Neal (D-MA) in the 112th Congress on February 16, 2012.

This bill amends the Internal Revenue Code to repeal the 10% cap on the qualified percentage of an employee’s compensation as the standard for an employer’s contribution to an automatic cash or deferred contribution arrangement under the alternative method for meeting nondiscrimination requirements. Authorizes regulations to increase the qualified percentage. Requires separate application of the rules for a top-heavy defined benefit plan (whose the present value of the accrued benefits [PVAB] for the highly-paid key employees exceeds 60% of the PVAB for all employees) to any defined contribution plan covering part-time employees who do not meet age and service requirements. Revises the period of service requirements for a qualified cash or deferred arrangement to cover long-term part-time employees working at least 3 consecutive 12-month periods during each of which the employee has at least 500 hours of service.

Directs the Secretaries of the Treasury and of Labor to prescribe administrative guidance establishing conditions allowing the use of a multiple employer plan. Directs the Government Accountability Office (GAO) to study the feasibility and desirability of extending the application of spousal consent requirements to defined contribution plans to which they do not currently apply. Amends the Employee Retirement Income Security Act of 1974 (ERISA) to authorize an employee benefit plan to allow a named fiduciary, or a fiduciary designated by a named fiduciary, to appoint an annuity administrator for an individual account plan. Directs the Secretary of the Treasury to issue final regulations stating that any specified age or service condition (or combination of such conditions) with respect to a lifetime income investment under a defined contribution plan shall be disregarded in determining whether the lifetime income investment is currently available for distribution to the employee.

Amends the Code to allow an Individual Retirement Account (IRA) to be invested in a life insurance contract rolled over to an IRA from a qualified retirement plan if the contract provides only incidental death benefits. Declares that a trust forming part of a defined contribution plan shall not be treated as failing to constitute a qualified trust solely by reason of allowing after a certain date as portable lifetime income options: (1) qualified distributions of a lifetime income investment, or (2) distributions of a lifetime income investment in the form of a qualified plan distribution annuity contract. Exempts from mandatory minimum plan distributions an employee whose aggregate retirement savings do not exceed $100,000. Amends ERISA to require the furnishing by paper, website, or other electronic communication of any pension plan documents or materials that must be furnished to a plan participant, beneficiary, or other individual.

Source: Congress.gov. Bill summary authored by the Congressional Research Service.

 

Small Business Pension Promotion Act of 2011

Introduced as HR 3561 by Representative Ron Kind (D-WI) in the 112th Congress on December 5, 2011.

Authorizes the Secretary of the Treasury to take steps to address any significant and broadly applicable decrease in the value of investments held by defined contribution plans and individual retirement accounts (IRAs), including by allowing: (1) taxpayers to use a later asset valuation date than otherwise required, and (2) additional time for making distributions from such plans and accounts.

Amends the Internal Revenue Code to: (1) allow a deduction in computing the net earnings from self-employment income for pension and IRA contributions, (2) allow a determination of the adjusted funding target attainment percentage for tax-exempt retirement plans without regard to the reduction for credit balances for funding-based limits on benefits under single employer plans, (3) repeal the excise tax on nondeductible contributions to qualified employer plans, and (4) provide a special rule for determining normal retirement age for certain existing defined benefit plans. Makes conforming amendments to the Employee Retirement Income Security Act (ERISA).

Source: Congress.gov. Bill summary authored by the Congressional Research Service.

 

Automatic IRA Act of 2011

Introduced as S 1557 by Senator Jeff Bingaman (D-NM) in the 112th Congress on Sep 14, 2011.

Amends the Internal Revenue Code to: (1) require certain employers who do not maintain qualified retirement plans or arrangements to make available to their eligible employees a payroll deposit individual retirement account (IRA) arrangement (automatic IRA arrangement) which grants such employees the right to opt-out of participation, (2) require the Secretary of the Treasury to provide employers with a model notice for notifying employees of automatic IRS arrangements and to establish a program to assist employers in the implementation of such arrangements, (3) allow employers who do not have more than 100 employees a tax credit for costs associated with establishing an automatic IRA arrangement, (4) impose a penalty on employers who fail to provide eligible employees access to automatic IRA arrangements, and (5) increase the tax credit for small employer pension plan start-up costs.

Requires the Secretary and the Secretary of Labor to jointly conduct feasibility studies on extending spousal consent requirements to automatic IRAs, promoting the use of low-cost lifetime income arrangements, and using investment data to notify individuals with multiple small balance retirement accounts of consolidation options.

Source: Congress.gov. Bill summary authored by the Congressional Research Service.

 

Small Businesses Add Value for Employees (SAVE) Act of 2011

Introduced as HR 1534 by Representative Ron Kind (D-WI) in the 112th Congress on April 14, 2011.

Amends Internal Revenue Code provisions relating to employer-established simple individual retirement accounts (IRAs) to: (1) repeal certain restrictions on rollovers from simple IRAs, (2) allow employers to elect to terminate qualified salary reduction arrangements at any time during the year, (3) repeal the enhanced 25% penalty on premature withdrawals made from simple IRAs within the first two plan years, (4) allow additional nonelective employer contributions to simple IRAs, (5) establish automatic deferral IRAs, (6) allow a transfer of unused balances in flexible spending arrangements to a qualified retirement or eligible deferred compensation plan, (7) increase the tax credit for small employer pension plan startup costs, and (8) establish multiple small employer retirement plans that provide for automatic employee contributions.

Requires the Office of Financial Education of the Department of the Treasury to develop and implement an outreach plan to educate small businesses on the types and benefits of available retirement plans. Requires the Secretaries of the Treasury and Labor to develop recommendations for small businesses to improve retirement outcomes. Requires the Secretary of the Treasury, in consultation with the Secretary of Education, to develop age-appropriate financial literacy curricula for elementary and secondary schools.

Amends the Employee Retirement Income Security Act of 1974 (ERISA) to: (1) permit payroll deduction plans for individual retirement accounts or annuities, and (2) require disclosures relating to lifetime income from pension plans and annuities.

Source: Congress.gov. Bill summary authored by the Congressional Research Service.