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house Bill H.R. 1994

Should Congress Make Bipartisan Reforms to 401(k) Plans & IRAs to Help Americans Save for Retirement?

Argument in favor

This bipartisan bill would make a number of common sense reforms to make it easier for workers and small businesses to save for retirement and improve enforcement of rules related to retirement plans.

Linda's Opinion
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05/19/2019
You can never save enough if you are a middle/low wage earner. You never have enough to save.
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doingmypart's Opinion
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05/23/2019
Plus pay the 2.6 trillion back to Social Security that was stollen.
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Kodiwodi's Opinion
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05/23/2019
I have no objection to the bill but feel it will do the elderly and disabled, the bulk of those retiring in the near future if ever, little to no good. It would be best for them to work on shoring up Social Security and improving healthcare in this country.
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Argument opposed

There’s no need to reform laws and regulations related to retirement plans, even on a bipartisan basis. Alternatively, this bill should include more substantial reforms.

Mart's Opinion
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05/19/2019
These are bogus savings methods. You save some of your check, you pay to invest, the admin makes millions with your money, you earn little, usually much less than COLA. And then you get punished for using and not using!
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JTJ's Opinion
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05/23/2019
No, congress has proven they know nothing about saving or fiscal responsibility. Want to help people save, balance the damn budget, cut spending and taxes.
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RAN's Opinion
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05/23/2019
I don’t trust government as far as I can throw any of you. Just leave things alone all you do is screw $hit up. All government is, is one big fk up.
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bill Progress


  • Not enacted
    The President has not signed this bill
  • The senate has not voted
  • The house Passed May 23rd, 2019
    Roll Call Vote 417 Yea / 3 Nay
      house Committees
      Committee on Education and Labor
      Committee on Ways and Means
    IntroducedMarch 29th, 2019

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What is House Bill H.R. 1994?

This bill — known as the SECURE Act — would modify the requirements for employer-provided retirement plans including 401(k) plans, individual retirement accounts (IRAs), and other tax-favored savings accounts with the goal of expanding opportunities for Americans to contribute to their retirement. A breakdown of its various provisions can be found below.

Expanding Retirement Savings

This section of the bill would:

  • Increase the credit for plan start-up cost to make it more affordable for small businesses to set up retirement plans, and create an additional new annual $500 per employee tax credit for employers to defray costs for new 401(k) plans and SIMPLE IRA plans that include automatic enrollment.

  • Repeal the maximum age for traditional IRA contributions, which is currently set at age 70 ½.

  • Increase the required beginning date for mandatory IRA distributions from age 70 ½ to 72.

  • Allow taxable non-tuition fellowship and stipend payments to qualify as income for the purposes of IRA contributions.

  • Allow long-term part-time workers to participate in 401(k) plans if they’ve completed either one year of service with more than 1,000 hours or three consecutive years with at least 500 hours of service.

  • Allow qualified defined contribution plans, section 403(b) plans, or governmental section 457(b) plans to make a direct trustee-to-trustee transfer to another employer-sponsored retirement plan or IRA of lifetime income investments if a lifetime income investment is no longer authorized to be held as an investment option under the plan. This would allow participants to avoid surrender charges and fees and preserve their lifetime income investments.

  • Allow penalty-free withdrawal from retirement plans for individuals in case of birth or adoption.

  • Qualified employer plans would be prohibited from making loans through credit cards and other arrangements.

  • Simplify 401(k) safe harbor rules to eliminate the notice requirement while maintaining the requirement to allow employees to make or change an election at least once per year.

Administrative Reforms & Other Benefits

This section of the bill would:

  • Require benefit statements to defined contribution plan participants to include a lifetime income disclosure at least once during any 12-month period, which would illustrate the monthly payments the participant would receive if the total account balance were used to provide lifetime income streams, including a qualified joint and survivor annuity for the participant and the participant’s surviving spouse and single life annuity.

  • Expand 529 education savings accounts to cover costs associated with registered apprenticeships; homeschooling; up to $10,000 of qualified student loan repayments (including those for siblings); and private elementary, secondary, or religious schools.

  • Reinstate for one year the exclusion for qualified state or local tax benefits and qualified reimbursement payments provided to members of qualified volunteer emergency response organizations and increases the exclusion for qualified reimbursement payments to $50 for each month the volunteer performs services.

Revenue Provisions

This section of the bill would:

  • Modify required minimum distribution rules to individuals other than the surviving spouse of the IRA owner, disabled or chronically ill individuals, individuals who are not mroe than 10 years younger than the IRA owner, or the IRA owner’s child so that distributions are completed by the end of the 10th calendar year after the IRA owner’s death.

  • Increase the failure to file penalty to the lesser of $400 or 100% of the amount of tax due.

  • Increase penalties for failure to file retirement plan returns, including Form 5500, a registration statements, a notification of change, or a withholding notice.

  • Allow the Internal Revenue Service (IRS) to share returns information with Customs and Border Protection (CBP) for the purposes of administering and collecting the heavy vehicle use tax.

The bill’s full title is the Setting Every Community Up for Retirement Enhancement (SECURE) Act of 2019.

Impact

Americans with retirement plans, such as a 401(k) or an IRA; businesses; the IRS and other relevant federal agencies.

Cost of House Bill H.R. 1994

The CBO estimates that enacting this bill would have the net effect of reducing deficits by $9 million over the 2019-2029 period.

More Information

In-DepthHouse Ways and Means Chairman Richard Neal (D-MA) introduced this bill to expand opportunities for Americans to contribute to their retirement savings:

“Americans currently face a retirement income crisis, with too many people in danger of not having enough savings to maintain their standard of living and avoid sliding into poverty. The SECURE Act goes a long way in addressing this problem by making it easier for Americans to save. Passage of this bill is a tremendous bipartisan accomplishment, and I hope to see the measure move through Congress and be signed into law in short order.”

Ways and Means Ranking Member Kevin Brady (R-TX) added:

“We are creating opportunity for workers across the country with this bipartisan legislation to help them make their own decisions about their finances and retirement. Our reforms will help families save more and earlier for the future, ensuring folks have the flexibility and control over their own savings they need for whatever life throws their way.”

This legislation passed the House Ways & Means Committee on a voice vote and has the support of 58 bipartisan cosponsors, including 36 Democrats and 22 Republicans.


Media:

Summary by Eric Revell

(Photo Credit: iStock.com / AndreyPopov)


AKA

Setting Every Community Up for Retirement Enhancement Act of 2019

Official Title

To amend the Internal Revenue Code of 1986 to encourage retirement savings, and for other purposes.

    You can never save enough if you are a middle/low wage earner. You never have enough to save.
    Like (37)
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    These are bogus savings methods. You save some of your check, you pay to invest, the admin makes millions with your money, you earn little, usually much less than COLA. And then you get punished for using and not using!
    Like (21)
    Follow
    Share
    Plus pay the 2.6 trillion back to Social Security that was stollen.
    Like (25)
    Follow
    Share
    I have no objection to the bill but feel it will do the elderly and disabled, the bulk of those retiring in the near future if ever, little to no good. It would be best for them to work on shoring up Social Security and improving healthcare in this country.
    Like (18)
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    Sure, why not. Especially if the changes stop corporations from using the funds from, or bankrupting a person’s/employee’s retirement savings account.
    Like (14)
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    Better to strengthen labor unions and bring back pensions, but it's a start.
    Like (13)
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    No, congress has proven they know nothing about saving or fiscal responsibility. Want to help people save, balance the damn budget, cut spending and taxes.
    Like (13)
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    Share
    I don’t trust government as far as I can throw any of you. Just leave things alone all you do is screw $hit up. All government is, is one big fk up.
    Like (12)
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    IRAs were not, in their original form, intended to replace pensions. They were intended to supplement. Corporations saw an opportunity and took it. Congress allowed it and then allowed unions to be attacked and broken. Congress allowed companies to bankrupt out of pension obligations. A corrupt banking system caused the Great Recession which caused people to lose whom and retirement savings. Congress did little, virtually no one was held accountable, and then what little Congress did was rolled back under Republican control of both houses, leaving Americans once again at risk for losing what they had worked hard to gather. The American worker has seen security, savings, property, and the one tool (unions) that, corrupt as they sometimes were, stood between workers and corporate greed. Anything that protects Americans from that greed, I support. That includes strengthening and protecting unions and collective bargaining rights so the legislatures of states, most of which are controlled by corporate-friendly Republicans, can’t harm them and protecting IRAs and homesteads. In fact, considering income inequality and corporate abuses of employees that result in personal life intrusion and excessive work hours, I think new unions for white collar workers should be formed.
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    Yes, something obviously needs to be changed if the current model is not functioning the way it was intended. If we can address the root cause of becoming broke and destitute during retirement, then individuals health will increase and many other benefits will result and we can focus on other issues in our societies.
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    Yes, Clearly Americans need help with retirement plans & savings. Impeach Trump= making the World a Better place.
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    Most of the provisions sound reasonable and should benefit those saving for retirement and those already or about to start drawing from it. Although I don’t understand how the emergency volunteers and sharing information with CBP belong in this bill, these points seem off topic.
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    I don't think it's a good idea to get our lawmakers involved in Americans 401K's or IRA's. The government hasn't done a very good job of managing our tax dollars, so why would I want them trying to help me save??? I fear they'd rob Peter to pay Paul... You know like they did when the stole money from Social Security and haven't paid it back!!!
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    Yes, but this will not matter to voters making less than $25.00 per hour. Proof of a sustainable, livable wage, along with maintaining the current dependent tax deduction is what voters will see evidence of. It won’t matter to blue wave voters if Trump vetos it, because we know Trump doesn’t care about anything other than himself. However, Dems will need to have evidence of doing something in the 2018 cycle to help lower and middle class workers between the ages of 25-50 if they want to win the next 2 election cycles.
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    I like the changes. We are starting a small business and this would help us
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    The House reforming anything is kinda an oxymoron at this point.
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    Too many people can't save hardly anything for their retirement. Folks need HELP!!
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    You need to stop taxing retirements especially IRAs, 401Ks. The investor takes all the risk and you tax it whether it gained or lost.
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    👍🏻👍🏻 House Bill H.R.1994 AKA the “SECURE Act” 👍🏻👍🏻 I support and recommend the passage the House bill H.R.1994 AKA the “SECURE Act” which would modify the requirements for employer-provided retirement plans including 401(k) plans, individual retirement accounts (IRAs), and other tax-favored savings accounts with the goal of expanding opportunities for Americans to contribute to their retirement. This bipartisan bill would make a number of common sense reforms to make it easier for workers and small businesses to save for retirement and improve enforcement of rules related to retirement plans. SneakyPete..... 5*22*19.....
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    Qualified yes. Good to improve 401k services. Bad to share IRS return info to CBP, as I do not trust the CBP to only use this information for the limited purpose stated and there is no effective oversight or penalty if the CBP uses it for other enforcement actions.
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