114th Congress, 1st Session

Small Businesses Add Value for Employees (SAVE) Act of 2015

Introduced as HR 4067 by Representative Ron Kind (D-WI) in the 114th Congress on November 18, 2015.

This bill amends the Internal Revenue Code, with respect to employer-established simple individual retirement accounts (IRAs) and pension plans, to:

      • repeal restrictions on rollovers from simple IRAs to qualified retirement plans;
      • allow employers to elect to terminate simple IRAs at any time during the year;
      • repeal the increased 25% penalty on premature distributions from simple IRAs within the first two plan years;
      • allow additional non-elective employer contributions to simple IRAs not exceeding 10% of compensation;
      • establish automatic deferral IRAs to permit the automatic enrollment of employees earning at least $5,000 in a preceding year;
      • establish secure deferral arrangements for automatically enrolling employees at 6% of pay with annual increases;
      • allow small employers a new tax credit for the cost of adopting safe harbor requirements for secure deferral arrangements;
      • allow a transfer of unused benefits in a flexible spending arrangement to a qualified retirement or eligible deferred compensation plan;
      • increase the tax credit for small employer pension plan startup costs; and
      • establish multiple small employer retirement plans that provide for automatic employee contributions. 

The bill requires:

(1) the Department of the Treasury to promulgate regulations regarding the timing of notices to participants in automatic contribution pension plans;
(2) the Office of Financial Education of Treasury to develop and implement an outreach plan to educate small businesses on the types and benefits of available retirement plans;
(3) Treasury and the Department of Labor to develop recommendations for small businesses to improve retirement outcomes; and
(4) Treasury, in consultation with the Department of Education, to develop age-appropriate financial literacy curricula for elementary and secondary schools.

The bill amends the Employee Retirement Income Security Act of 1974 (ERISA) to: (1) exempt IRAs that permit payroll deductions from additional pension plan requirements, (2) require disclosures relating to lifetime income from pension plans and annuities, and (3) set forth safe harbor criteria for the selection of an annuity contract and an insurer.

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


Retirement Choice Protection Act of 2015

Introduced as HR 3922 by Representative Mike Kelly (R-PA) in the 114th Congress on November 4, 2015.

This bill amends the Reorganization Plan No. 4 of 1978 to transfer from the Department of Labor to the Department of the Treasury regulatory authority for Individual Retirement Accounts (IRAs), retirement annuities, Simplified Employee Pensions, and Simple IRAs.

The bill amends the Internal Revenue Code and the Employee Retirement Income Security Act of 1974 (ERISA) to establish a best interest standard for fiduciaries who provide advice to investors in IRAs and plans not subject to ERISA. The best interest standard allows a financial advisor to make investment recommendations and receive compensation with respect to certain financial products, including proprietary products, if such advisor makes certain required disclosures.

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


Retirement Security Act of 2015

Introduced as joint bills S 266 by Senator Susan Collins (R-ME) and HR 557 by Representative Vern Buchanan (R-FL) in the Senate and House, respectively, in the 114th Congress on Jan 27, 2015.

Directs the Secretary of the Treasury to: (1) prescribe final regulations to permit employers to participate in multiple employer pension benefit plans, (2) promulgate regulations or other guidance to simplify and clarify rules relating to the timing of participant notices required under tax-preferred pension plans and the automatic escalation rules, and (3) modify the 1040EZ tax return form to allow taxpayers to claim the tax credit for retirement savings (saver’s credit) on such form.

Amends the Employee Retirement Income Security Act of 1974 (ERISA) and the Internal Revenue Code, with respect to employer pension benefit plans, to: (1) allow employers to maintain a tax-exempt multiple employer pension benefit plan even if the employers sponsoring the plan share no common interest, (2) modify requirements for secure deferral arrangements with respect to nondiscrimination and employer matching contributions, and (3) allow employers with not more than 100 employees a business-related tax credit to cover increased matching contributions required by this Act.

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

Automatic IRA Act of 2015

Introduced as joint bills HR 506 by Representative Richard Neal (D-MA) and S 245  by Senator Sheldon Whitehouse (D-RI) in the 114th Congress on Jan 22, 2015.

This bill 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 an automatic IRA arrangement and to provide participants with an annual statement setting forth payments, earnings, value, and other specified information; (3) impose a penalty on employers who fail to provide eligible employees access to an automatic IRA arrangement; (4) allow employers who do not have more than 100 employees a tax credit for costs associated with establishing an automatic IRA arrangement; and (5) increase the dollar limitation on the tax credit for small employer pension plan startup costs.

Establishes an Automatic IRA Advisory Group to make recommendations regarding automatic IRA investment options.

Requires the Secretary and the Secretary of Labor to jointly conduct feasibility studies on: (1) extending spousal consent requirements to automatic IRA arrangements; (2) 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; (3) using investment data to notify individuals with multiple small balance retirement accounts of consolidation options; and (4) using investment arrangements associated with automatic IRAs to assist in addressing the problem of abandoned accounts.

Directs the Secretaries to prescribe administrative guidance for the use of multiple employer plans by December 31, 2015.

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