Legislative Update - Fall 2019
Oct 4, 2019 | By Jon Vogler
Even though Congress was on vacation for several weeks, some notable bills were recently introduced in the last quarter:
The Automatic IRA Act of 2019 (in the “IRAs” section) would expand personal savings and retirement savings coverage by enabling employees not covered by qualifying retirement plans to save for retirement through automatic IRA arrangements. Exceptions would be made for small or new employers, as provided in the bill, as well as for church or governmental organizations.
A House concurrent resolution (in the “Multi-employer plans” section) would establish the Joint Select Committee on Solvency of Multi-Employer Pension Plans, which will provide recommendations and legislative language that will significantly improve the solvency of multi-employer pension plans (which are typically defined benefit pension plans for union employees) and the Pension Benefit Guaranty Corporation (PBGC). (For more on this topic, see the Fall 2019 Washington Insights.)
The Expanding Access to Retirement Act (in the “Pooled employer plans” section) would provide for association retirement plans, a type of multiple employer plan to provide workplace retirement benefits. Participating employers would need to be part of a group or association of employers, such as a common industry, trade or business. The bill would also allow professional employer organizations (PEOs [entities that generally contract with their client employers to perform functions that are typically performed by an employer, such as payroll, tax compliance and human resource management]) to sponsor an association retirement plan. (The Department of Labor separately issued related final regulations this summer; see our recent blog on this topic.)
The Social Security for Future Generations Act (in the “Social Security” section) would enhance Social Security benefits and maintain the commitment and the long-term solvency of the Social Security program. Among other items, the bill would include earnings over $250,000 in the Social Security benefit formula and provide an increase in the minimum benefit for lifetime low earners based on years in the workforce.
The Social Security Caregiver Act of 2019 (also in the “Social Security” section) would credit individuals serving as caregivers of dependent relatives with deemed wages up to five years of such service for Social Security purposes, and also support state medical training programs for caregivers.
As an update, the best remaining chance for the Setting Every Community Up for Retirement Enhancement (SECURE) Act (the comprehensive retirement-related bill passed by the House by an overwhelming margin in May, listed in the below “Retirement reform” section) to be enacted as of this writing is if it’s attached to other “must pass” legislation, such as the appropriations bills with funding for government agencies slated for late September or future spending bills later this year. (Its path forward in the Senate as a stand-alone bill via unanimous consent is still blocked by a handful of senators, and floor time will likely not be allocated for a full discussion of the bill’s provisions.)
Please download the PDF to read about bills that are actively being considered by Congress at this time. For more information on these and other bills, visit the Library of Congress website.
The opinions expressed are those of the author, are based on current market conditions and are subject to change without notice. These opinions may differ from those of other Invesco investment professionals.
Invesco does not provide tax advice. The tax information contained herein is general and is not exhaustive by nature. It is not intended or written to be used, and it cannot be used by any taxpayer, for the purpose of avoiding tax penalties that may be imposed on the taxpayer under U.S. federal tax laws. Federal and state tax laws are complex and constantly changing. Investors should always consult their own legal or tax advisor for information concerning their individual situation.