I 

115TH CONGRESS 

1ST SESSION H. R. 4523 

To amend the Internal Revenue Code of 1986 to expand retirement plan 

coverage, increase retirement security, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

DECEMBER 1, 2017 

Mr. NEAL introduced the following bill; which was referred to the Committee 

on Ways and Means, and in addition to the Committee on Education and 

the Workforce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To amend the Internal Revenue Code of 1986 to expand 

retirement plan coverage, increase retirement security, 

and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Automatic Retirement Plan Act of 2017’’. 

6 (b) TABLE OF CONTENTS.—The table of contents of 

7 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Employers required to maintain automatic contribution plan. 


dlhill on DSK3GLQ082PROD with BILLS
2 

•HR 4523 IH

Sec. 3. Deferral-only arrangements. 

Sec. 4. Nondiscrimination testing changes to facilitate higher contributions. 

Sec. 5. Multiple employer plans. 

Sec. 6. Limitation on employer liability. 

Sec. 7. Portability of lifetime income options. 

Sec. 8. Increase in credit limitation for small employer pension plan startup 

costs. 

Sec. 9. Small employer automatic enrollment credit. 

Sec. 10. Treatment of automatic contribution plans under State law. 

Sec. 11. Matching payments for elective deferral and IRA contributions by certain individuals. 

Sec. 12. Authority to require reporting. 

1 SEC. 2. EMPLOYERS REQUIRED TO MAINTAIN AUTOMATIC 

2 CONTRIBUTION PLAN. 

3 (a) AUTOMATIC CONTRIBUTION PLAN.—Section 414 

4 of the Internal Revenue Code of 1986 is amended by add5 ing at the end the following: 

6 ‘‘(aa) AUTOMATIC CONTRIBUTION PLAN.—For pur7 poses of this title— 

8 ‘‘(1) IN GENERAL.—The term ‘automatic con9 tribution plan’ means a defined contribution plan 

10 that— 

11 ‘‘(A) is described in clause (i), (ii), or (iv) 

12 of section 219(g)(5)(A), 

13 ‘‘(B) is described in paragraph (2), and 

14 ‘‘(C) meets the eligibility, investment, life15 time income, and fee requirements described in 

16 paragraphs (3), (4), (5), and (6), respectively, 

17 of this subsection. 

18 ‘‘(2) PLAN DESCRIBED.—A plan is described in 

19 this paragraph if the plan is one of the following: 


dlhill on DSK3GLQ082PROD with BILLS
3 

•HR 4523 IH

1 ‘‘(A) DEFERRAL ONLY.—A deferral only 

2 arrangement that meets the requirements of 

3 section 401(k)(14). 

4 ‘‘(B) 403(b) PLAN.—A 403(b) plan that— 

5 ‘‘(i) meets the requirements of section 

6 401(k)(14), or 

7 ‘‘(ii) would be described in subpara8 graph (C) without regard to the references 

9 to section 416. 

10 ‘‘(C) TESTING AUTOMATIC CONTRIBUTION

11 PLAN.—A plan that— 

12 ‘‘(i) would qualify as a plan described 

13 in subparagraph (A), except that such plan 

14 allows employer contributions, and 

15 ‘‘(ii) satisfies sections 

16 401(k)(3)(A)(ii), 401(m)(2), and 416 tak17 ing into account all applicable rules, in18 cluding— 

19 ‘‘(I) paragraphs (11), (12), and 

20 (13) of section 401(k), 

21 ‘‘(II) paragraphs (10), (11), and 

22 (12) of section 401(m), and 

23 ‘‘(III) section 416(g)(4)(H). 

24 ‘‘(D) GRANDFATHERED AUTOMATIC CON25 TRIBUTION PLAN.—A plan described in clause 


dlhill on DSK3GLQ082PROD with BILLS
4 

•HR 4523 IH

1 (i), (ii), (iv), (v), or (vi) of section 219(g)(5)(A) 

2 that— 

3 ‘‘(i) is maintained by an employer as 

4 of the date of enactment of the Automatic 

5 Retirement Plan Act of 2017, 

6 ‘‘(ii) has been maintained by such em7 ployer (or a predecessor employer) for at 

8 least 1 year before such date of enactment, 

9 and 

10 ‘‘(iii) except as provided by the Sec11 retary, has not had its coverage or benefits 

12 substantially decreased for any plan year 

13 beginning after such date of enactment. 

14 ‘‘(3) ELIGIBILITY REQUIREMENTS.— 

15 ‘‘(A) IN GENERAL.—Subject to subpara16 graph (B), the eligibility requirements described 

17 in this paragraph are that all employees of the 

18 employer are eligible to participate in an auto19 matic contribution plan maintained by the em20 ployer. 

21 ‘‘(B) CERTAIN EXCLUSIONS.—Subpara22 graph (A) shall not apply to the following: 

23 ‘‘(i) INDIVIDUALS LESS THAN 21

24 YEARS OLD.—The employer may, but need 

25 not, include an employee who has not atVerDate Sep 11 2014 02:39 Dec 06, 2017 Jkt 079200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H4523.IH H4523

dlhill on DSK3GLQ082PROD with BILLS
5 

•HR 4523 IH

1 tained age 21 in an automatic contribution 

2 plan maintained by the employer. 

3 ‘‘(ii) CERTAIN OTHER EMPLOYEES.— 

4 The employer may, but need not, include 

5 an employee described in section 410(b)(3) 

6 in an automatic contribution plan main7 tained by the employer. 

8 ‘‘(iii) PART TIME EMPLOYEES, ETC.— 

9 No employee may be treated as ineligible 

10 in an automatic contribution plan main11 tained by the employer solely by reason of 

12 working on a part-time, temporary, or sea13 sonal basis, except as otherwise provided in 

14 this subparagraph. 

15 ‘‘(iv) NEW EMPLOYEE.—The employer 

16 may, but need not, exclude an employee 

17 from an automatic contribution plan main18 tained by the employer until the first day 

19 of the second calendar month beginning on 

20 or after the day the individual begins work 

21 for the employer. 

22 ‘‘(v) SEASONAL OR TEMPORARY EM23 PLOYEES.—The employer may, but need 

24 not, exclude an employee from an auto25 matic contribution plan maintained by the 


dlhill on DSK3GLQ082PROD with BILLS
6 

•HR 4523 IH

1 employer to the extent that such employee 

2 is not expected to work during more than 

3 three months during the 12-month period 

4 starting when such employee would other5 wise be required to be eligible under such 

6 plan. 

7 ‘‘(C) SPECIAL RULES FOR CONTROLLED

8 GROUPS.—Eligible employees within an em9 ployer need not be eligible to participate in the 

10 same automatic contribution plan. For purposes 

11 of this subsection, the term ‘employer’ shall in12 clude all employers treated as a single employer 

13 under subsection (b), (c), (m), or (o) of section 

14 414. 

15 ‘‘(D) SPECIAL RULES FOR GRAND16 FATHERED PLANS.—This paragraph shall not 

17 apply to a plan described in paragraph (2)(D) 

18 until the sixth plan year beginning on or after 

19 the date of enactment of the Automatic Retire20 ment Plan Act of 2017. In the case of an eligi21 ble employer (as defined in section 

22 408(p)(2)(C)(i)), ‘eighth’ shall be substituted 

23 for ‘sixth’ in the preceding sentence. 

24 ‘‘(4) INVESTMENT REQUIREMENTS.—Except in 

25 the case of a plan that is an automatic contribution 


dlhill on DSK3GLQ082PROD with BILLS
7 

•HR 4523 IH

1 plan by reason of paragraph (2)(D), any investment 

2 made in the absence of an investment election by a 

3 participant or beneficiary shall be invested in accord4 ance with regulations prescribed by the Secretary of 

5 Labor under section 404(c)(5) of the Employee Re6 tirement Income Security Act of 1974. 

7 ‘‘(5) LIFETIME INCOME REQUIREMENTS.—Ex8 cept in the case of a plan that is an automatic con9 tribution plan by reason of paragraph (2)(D), the 

10 lifetime income requirements described in this para11 graph are— 

12 ‘‘(A) GUARANTEED INCOME FOR LIFE

13 AVAILABLE.—A plan shall not be treated as an 

14 automatic contribution plan unless the plan per15 mits participants to elect to receive at least 50 

16 percent of their vested account balance in a 

17 form of distribution described in section 

18 401(a)(38)(B)(iii). 

19 ‘‘(B) EXCEPTIONS.—This paragraph shall 

20 not apply with respect to any participant whose 

21 vested account balance is $5,000 or less at the 

22 time of distribution. 

23 ‘‘(6) FEE REQUIREMENTS.—Under the fee re24 quirements of this paragraph, no participant may be 

25 charged unreasonable fees solely on the basis that 


dlhill on DSK3GLQ082PROD with BILLS
8 

•HR 4523 IH

1 the participant’s balance in an automatic contribu2 tion plan is small or solely on the basis that adop3 tion of such a plan by the employee’s employer is 

4 mandatory.’’. 

5 (b) EXCISE TAX FOR FAILURE TO MAINTAIN AUTO6 MATIC CONTRIBUTION PLAN.—Chapter 43 of such Code 

7 is amended by adding at the end the following new section: 

8 ‘‘SEC. 4980J. FAILURE TO MAINTAIN AUTOMATIC CON9 TRIBUTION PLAN. 

10 ‘‘(a) GENERAL RULE.— 

11 ‘‘(1) IN GENERAL.—There is hereby imposed a 

12 tax on the failure of an employer to make eligible to 

13 participate in an automatic contribution plan main14 tained by the employer any employee of the employer 

15 who, under the terms of section 414(aa), would be 

16 required to be eligible to participate in an automatic 

17 contribution plan maintained by the employer. 

18 ‘‘(2) EXCEPTIONS.— 

19 ‘‘(A) Paragraph (1) shall not apply to an 

20 employer to the extent such employer partici21 pates in an arrangement under a qualified 

22 State law under section 514(f)(2) of the Em23 ployee Retirement Income Security Act of 1974. 

24 ‘‘(B) Paragraph (1) shall not apply to an 

25 employer with respect to any employee who is 


dlhill on DSK3GLQ082PROD with BILLS
9 

•HR 4523 IH

1 eligible to participate in a different automatic 

2 contribution plan than one or more other em3 ployees of the employer. 

4 ‘‘(b) AMOUNT OF TAX.— 

5 ‘‘(1) IN GENERAL.—The amount of the tax im6 posed by subsection (a) on any failure with respect 

7 to an employee shall be $10 for each day in the non8 compliance period with respect to such failure. 

9 ‘‘(2) NONCOMPLIANCE PERIOD.—For purposes 

10 of this section, the term ‘noncompliance period’ 

11 means, with respect to any failure, the period— 

12 ‘‘(A) beginning on the date such failure 

13 first occurs, and 

14 ‘‘(B) ending on the earlier of— 

15 ‘‘(i) the date such failure is corrected, 

16 or 

17 ‘‘(ii) with respect to any employer, the 

18 date that is 3 months after the last date 

19 on which the employee is required to be eli20 gible to participate in an automatic con21 tribution plan maintained by such em22 ployer. 

23 ‘‘(c) LIMITATIONS ON AMOUNT OF TAX.— 

24 ‘‘(1) TAX NOT TO APPLY WHERE FAILURE NOT

25 DISCOVERED EXERCISING REASONABLE DILIVerDate Sep 11 2014 02:39 Dec 06, 2017 Jkt 079200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H4523.IH H4523

dlhill on DSK3GLQ082PROD with BILLS
10 

•HR 4523 IH

1 GENCE.—No tax shall be imposed by subsection (a) 

2 on any failure during any period for which it is es3 tablished to the satisfaction of the Secretary that 

4 none of the persons referred to in subsection (e) 

5 knew that such failure existed. 

6 ‘‘(2) TAX NOT TO APPLY TO FAILURES CORRECTED WITHIN 91 7 ⁄2 MONTHS.—No tax shall be im8 posed by subsection (a) on any failure if— 

9 ‘‘(A) such failure was due to reasonable 

10 cause and not to willful neglect, and 

11 ‘‘(B) such failure is corrected during the 

91 12 ⁄2-month period beginning on the first date 

13 any of the persons referred to in subsection (e) 

14 knew that such failure existed. 

15 ‘‘(3) OVERALL LIMITATION FOR UNINTEN16 TIONAL FAILURES.—In the case of failures which 

17 are due to reasonable cause and not to willful ne18 glect— 

19 ‘‘(A) GENERAL RULE.—The tax imposed 

20 by subsection (a) for failures during the taxable 

21 year of the employer shall not exceed $500,000. 

22 ‘‘(B) TAXABLE YEARS IN THE CASE OF

23 CERTAIN CONTROLLED GROUPS.—For purposes 

24 of this subparagraph, if not all persons who are 

25 treated as a single employer for purposes of this 


dlhill on DSK3GLQ082PROD with BILLS
11 

•HR 4523 IH

1 section have the same taxable year, the taxable 

2 years taken into account shall be determined 

3 under principles similar to the principles of sec4 tion 1561. 

5 ‘‘(4) WAIVER BY SECRETARY.—In the case of a 

6 failure which is due to reasonable cause and not to 

7 willful neglect, the Secretary may waive part or all 

8 of the tax imposed by subsection (a) to the extent 

9 that the payment of such tax would be excessive rel10 ative to the failure involved. 

11 ‘‘(d) TAX NOT TO APPLY IN CERTAIN CASES.—This 

12 section shall not apply in the case of— 

13 ‘‘(1) any failure of an employer to meet the re14 quirements of subsection (a) with respect to any em15 ployee if the failure with respect to such employee 

16 occurred during the calendar year immediately fol17 lowing a calendar year during which all employers 

18 maintaining such plan normally employed 10 or 

19 fewer employees on a typical business day, 

20 ‘‘(2) any governmental plan (within the mean21 ing of section 414(d)), 

22 ‘‘(3) any church plan (within the meaning of 

23 section 414(e)), or 


dlhill on DSK3GLQ082PROD with BILLS
12 

•HR 4523 IH

1 ‘‘(4) employers that have not been in existence 

2 for three years, taking into account all predecessor 

3 employers. 

4 ‘‘(e) LIABILITY FOR TAX.—The employer shall be lia5 ble for the tax imposed by subsection (a) on a failure. All 

6 employers, determined without regard to subsection (f)(2), 

7 shall be jointly and severally liable for the liability of any 

8 other employer with which they are aggregated under sub9 section (f)(2). 

10 ‘‘(f) DEFINITIONS.—For purposes of this section— 

11 ‘‘(1) the term ‘automatic contribution plan’ has 

12 the meaning given such term under section 414(aa), 

13 and 

14 ‘‘(2) the term ‘employer’ includes all employers 

15 treated as a single employer under subsection (b), 

16 (c), (m), or (o) of section 414.’’. 

17 (c) CLERICAL AMENDMENT.—The table of sections 

18 for chapter 43 of the Internal Revenue Code of 1986 is 

19 amended by adding at the end the following new item: 

‘‘Sec. 4980J. Failure to maintain automatic contribution plan.’’. 

20 (d) EFFECTIVE DATE.— 

21 (1) IN GENERAL.—The amendments made by 

22 subsection (a) shall apply to years beginning after 

23 December 31, 2017. 

24 (2) DELAYED EFFECTIVE DATE.— 


dlhill on DSK3GLQ082PROD with BILLS
13 

•HR 4523 IH

1 (A) LARGE EMPLOYERS.—Except as pro2 vided in subparagraph (B), the amendments 

3 made by subsections (b) and (c) shall apply to 

4 years beginning after December 31, 2019. 

5 (B) SMALL EMPLOYERS.—In the case of 

6 an eligible employer (as defined in section 

7 408(p)(2)(C)(i) of the Internal Revenue Code of 

8 1986), the amendments made by subsections 

9 (b) and (c) shall apply to years beginning after 

10 December 31, 2021. 

11 SEC. 3. DEFERRAL-ONLY ARRANGEMENTS. 

12 (a) IN GENERAL.—Subsection (k) of section 401 of 

13 the Internal Revenue Code of 1986 is amended by adding 

14 at the end the following new paragraph: 

15 ‘‘(14) DEFERRAL-ONLY ARRANGEMENT.— 

16 ‘‘(A) IN GENERAL.—A deferral-only ar17 rangement shall be treated as meeting the re18 quirements of paragraph (3)(A)(ii). 

19 ‘‘(B) DEFERRAL-ONLY ARRANGEMENT.— 

20 For purposes of this paragraph, the term ‘de21 ferral-only arrangement’ means any cash or de22 ferred arrangement which meets— 

23 ‘‘(i) the automatic deferral require24 ments of subparagraph (C), 


dlhill on DSK3GLQ082PROD with BILLS
14 

•HR 4523 IH

1 ‘‘(ii) the elective contribution require2 ment of subparagraph (D), and 

3 ‘‘(iii) the requirements of subpara4 graph (E) of paragraph (13). 

5 ‘‘(C) AUTOMATIC DEFERRAL.— 

6 ‘‘(i) IN GENERAL.—The requirements 

7 of this subparagraph are met if, under the 

8 arrangement, each employee eligible to 

9 participate in the arrangement who is not 

10 contributing or is contributing less than 

11 the qualified percentage applicable to an 

12 eligible employee in the first year of eligi13 bility is treated as having elected in appli14 cable years to have the employer make 

15 elective contributions in an amount equal 

16 to the qualified percentage of compensation 

17 applicable under clause (iii). In the absence 

18 of an election out as described in clause 

19 (ii), such election shall, as adjusted under 

20 clause (iii), remain in effect for all subse21 quent years, regardless of whether such 

22 years are applicable years. 

23 ‘‘(ii) ELECTION OUT.—The election 

24 treated as having been made under clause 

25 (i) shall cease to apply with respect to any 


dlhill on DSK3GLQ082PROD with BILLS
15 

•HR 4523 IH

1 employee if such employee makes an af2 firmative election— 

3 ‘‘(I) to not have such contribu4 tions made, or 

5 ‘‘(II) to make elective contribu6 tions at a level specified in such af7 firmative election. 

8 ‘‘(iii) QUALIFIED PERCENTAGE.—For 

9 purposes of this subparagraph, with re10 spect to any employee, the term ‘qualified 

11 percentage’ means, in lieu of the meaning 

12 given such term in paragraph (13)(C)(iii), 

13 any percentage determined under the ar14 rangement if such percentage is applied 

15 uniformly and is— 

16 ‘‘(I) at least 6 percent, but not 

17 greater than 10 percent, during the 

18 period ending on the last day of the 

19 first plan year which begins after the 

20 date on which the first elective con21 tribution described in clause (i) is 

22 made with respect to such employee 

23 (disregarding any elective contribution 

24 made for any preceding year that pre25 ceded a year in which the employee 


dlhill on DSK3GLQ082PROD with BILLS
16 

•HR 4523 IH

1 made an affirmative election described 

2 in clause (ii)), 

3 ‘‘(II) at least 7 percent during 

4 the first plan year following the plan 

5 year described in subclause (I), 

6 ‘‘(III) at least 8 percent during 

7 the first plan year following the plan 

8 year described in subclause (II), 

9 ‘‘(IV) at least 9 percent during 

10 the first plan year following the plan 

11 year described in subclause (III), and 

12 ‘‘(V) At least 10 percent during 

13 any subsequent plan year. 

14 ‘‘(iv) APPLICABLE YEAR EVERY THIRD

15 YEAR.— 

16 ‘‘(I) IN GENERAL.—For purposes 

17 of this subparagraph, the term ‘appli18 cable year’ means, with respect to an 

19 employee, such employee’s first plan 

20 year of eligibility under the arrange21 ment, and all subsequent plan years 

22 of eligibility. 

23 ‘‘(II) EXCEPTION.—Following 

24 any applicable year of the employee 

25 (determined after the application of 


dlhill on DSK3GLQ082PROD with BILLS
17 

•HR 4523 IH

1 this subclause), the plan may elect to 

2 treat the next one or two plan years 

3 as not being applicable years with re4 spect to such employee. 

5 ‘‘(D) ELECTIVE CONTRIBUTIONS.— 

6 ‘‘(i) IN GENERAL.—The requirements 

7 of this subparagraph are met if under the 

8 plan containing the arrangement— 

9 ‘‘(I) the only contributions which 

10 may be made are elective contribu11 tions of employees who are eligible to 

12 participate in the arrangement, and 

13 ‘‘(II) the aggregate amount of 

14 such elective contributions which may 

15 be made with respect to any employee 

16 for any calendar year shall not exceed 

17 $8,000. 

18 ‘‘(ii) COST OF LIVING ADJUSTMENT.— 

19 In the case of any calendar year beginning 

20 after December 31, 2018, the $8,000 

21 amount under clause (i) shall be adjusted 

22 in the same manner as cost of living ad23 justments are made under section 

24 402(g)(4), except that ‘2017’ shall be sub25 stituted for ‘2005’. 


dlhill on DSK3GLQ082PROD with BILLS
18 

•HR 4523 IH

1 ‘‘(iii) CROSS REFERENCE.—For catch2 up contributions for individuals age 50 or 

3 over, see section 414(v).’’. 

4 (b) CATCH-UP CONTRIBUTIONS FOR INDIVIDUALS

5 AGE 50 AND OVER.— 

6 (1) Clause (i) of section 414(v)(2)(B) of such 

7 Code is amended by inserting ‘‘, 401(k)(14),’’ after 

8 ‘‘401(k)(11)’’. 

9 (2) Section 414(v)(2)(B) of such Code is 

10 amended by adding at the end thereof the following 

11 clause: 

12 ‘‘(iii) in the case of an applicable em13 ployer plan described in section 

14 401(k)(14), the applicable dollar amount is 

15 $1,000.’’. 

16 (3) Section 414(v)(2)(C) of such Code is 

17 amended by— 

18 (A) by striking ‘‘(B)(i) and’’ and inserting 

19 ‘‘(B)(i),’’ and by inserting after ‘‘subparagraph 

20 (B)(ii)’’ the following: ‘‘, and the $1,000 

21 amount described in subparagraph (B)(iii)’’, 

22 and 

23 (B) inserting after ‘‘2005’’ the following: 

24 ‘‘(the calendar quarter beginning July 1, 2017, 


dlhill on DSK3GLQ082PROD with BILLS
19 

•HR 4523 IH

1 in the case of the $1,000 amount described in 

2 subparagraph (B)(iii))’’. 

3 (c) SIMPLIFIED REPORTING.—Section 104(a)(2)(A) 

4 of the Employee Retirement Income Security Act of 1974 

5 (29 U.S.C. 1024(a)(2)) is amended by inserting ‘‘or for 

6 any pension plan which is a deferral-only arrangement de7 scribed in section 401(k)(14)(B) of the Internal Revenue 

8 Code of 1986’’ before the period at the end. 

9 (d) PLANS NOT TREATED AS TOP-HEAVY PLANS.— 

10 Clause (i) of section 416(g)(4)(H) of such Code is amend11 ed by striking ‘‘or 401(k)(13)’’ and inserting ‘‘401(k)(13), 

12 or 401(k)(14)’’. 

13 (e) EFFECTIVE DATE.—The amendments made by 

14 this section shall apply to plan years beginning after De15 cember 31, 2017. 

16 SEC. 4. NONDISCRIMINATION TESTING CHANGES TO FA17 CILITATE HIGHER CONTRIBUTIONS. 

18 (a) IN GENERAL.—Clause (iii) of section 

19 401(k)(13)(C) of the Internal Revenue Code of 1986 is 

20 amended by striking ‘‘, does not exceed 10 percent, and 

21 is at least’’ and inserting ‘‘and is’’. 

22 (b) CONFORMING AMENDMENTS.— 

23 (1) Subclause (I) of section 401(k)(13)(C)(iii) 

24 of such Code is amended by striking ‘‘3 percent’’ 


dlhill on DSK3GLQ082PROD with BILLS
20 

•HR 4523 IH

1 and inserting ‘‘at least 3 percent, but not greater 

2 than 10 percent,’’. 

3 (2) Subclause (II) of section 401(k)(13)(C)(iii) 

4 of such Code is amended by striking ‘‘4 percent’’ 

5 and inserting ‘‘at least 4 percent’’. 

6 (3) Subclause (III) of section 401(k)(13)(C)(iii) 

7 of such Code is amended by striking ‘‘5 percent’’ 

8 and inserting ‘‘at least 5 percent’’. 

9 (4) Subclause (IV) of section 401(k)(13)(C)(iii) 

10 of such Code is amended by striking ‘‘6 percent’’ 

11 and inserting ‘‘at least 6 percent’’. 

12 (c) MATCHING CONTRIBUTIONS.—Clause (i) of sec13 tion 401(m)(11)(B) of such Code is amended by striking 

14 ‘‘6’’ and inserting ‘‘10’’. 

15 (d) EFFECTIVE DATE.—The amendments made by 

16 this section shall apply to plan years beginning after De17 cember 31, 2017. 

18 SEC. 5. MULTIPLE EMPLOYER PLANS. 

19 (a) QUALIFICATION REQUIREMENTS.— 

20 (1) IN GENERAL.—Section 413 of the Internal 

21 Revenue Code of 1986, as amended by this Act, is 

22 amended by adding at the end the following new 

23 subsection: 


dlhill on DSK3GLQ082PROD with BILLS
21 

•HR 4523 IH

1 ‘‘(g) APPLICATION OF QUALIFICATION REQUIRE2 MENTS FOR CERTAIN MULTIPLE EMPLOYER PLANS WITH

3 POOLED PLAN PROVIDERS.— 

4 ‘‘(1) IN GENERAL.—Except as provided in para5 graph (2), a defined contribution plan to which sub6 section (c) applies shall not be treated as failing to 

7 meet the requirements under this title applicable to 

8 a plan described in section 401(a) or to a plan that 

9 consists of individual retirement accounts described 

10 in section 408 (including by reason of subsection (c) 

11 thereof), whichever is applicable, merely because one 

12 or more employers of employees covered by the plan 

13 fail to take such actions as are required of such em14 ployers for the plan to meet such requirements if the 

15 plan— 

16 ‘‘(A) is sponsored by employers all of 

17 which have both a common interest other than 

18 having adopted the plan and control of the 

19 plan, or 

20 ‘‘(B) in the case of a plan not described in 

21 subparagraph (A), has a pooled plan provider. 

22 ‘‘(2) LIMITATIONS.— 

23 ‘‘(A) IN GENERAL.—Paragraph (1) shall 

24 not apply to any plan unless the terms of the 

25 plan provide that in cases of employers failing 


dlhill on DSK3GLQ082PROD with BILLS
22 

•HR 4523 IH

1 to take the actions described in paragraph 

2 (1)— 

3 ‘‘(i) the assets of the plan attributable 

4 to employees of the employer will be trans5 ferred to a plan maintained only by the 

6 employer (or its successor), to an eligible 

7 retirement plan as defined in section 

8 402(c)(8)(B) for each individual whose ac9 count is transferred, or to any other ar10 rangement that the Secretary determines is 

11 appropriate, unless the Secretary deter12 mines it is in the best interests of such em13 ployees to retain the assets in the plan, 

14 and 

15 ‘‘(ii) the employer described in clause 

16 (i) (and not the plan with respect to which 

17 the failure occurred or any other partici18 pating employer in such plan) shall, except 

19 to the extent provided by the Secretary, be 

20 liable for any liabilities with respect to 

21 such plan attributable to employees of the 

22 employer. 

23 ‘‘(B) FAILURES BY POOLED PLAN PRO24 VIDERS.—If the pooled plan provider of a plan 

25 described in paragraph (1)(B) does not perform 


dlhill on DSK3GLQ082PROD with BILLS
23 

•HR 4523 IH

1 substantially all of the administrative duties 

2 which are required of the provider under para3 graph (3)(A)(i) for any plan year, the Sec4 retary, in the Secretary’s own discretion, may 

5 provide that the determination as to whether 

6 the plan meets the requirements under this title 

7 applicable to a plan described in section 401(a) 

8 or to a plan that consists of individual retire9 ment accounts described in section 408 (includ10 ing by reason of subsection (c) thereof), which11 ever is applicable, shall be made in the same 

12 manner as would be made without regard to 

13 paragraph (1). 

14 ‘‘(3) POOLED PLAN PROVIDER.—For purposes 

15 of this subsection— 

16 ‘‘(A) IN GENERAL.—The term ‘pooled plan 

17 provider’ means, with respect to any plan, a 

18 person who— 

19 ‘‘(i) is designated by the terms of the 

20 plan as a named fiduciary (as defined in 

21 section 402(a)(2) of the Employee Retire22 ment Income Security Act of 1974), as the 

23 plan administrator, and as the person re24 sponsible to perform all administrative du25 ties (including conducting proper testing 


dlhill on DSK3GLQ082PROD with BILLS
24 

•HR 4523 IH

1 with respect to the plan and employees of 

2 each participating employer) which are 

3 reasonably necessary to ensure that— 

4 ‘‘(I) the plan meets any require5 ment applicable under the Employee 

6 Retirement Income Security Act of 

7 1974 or this title to a plan described 

8 in section 401(a) or to a plan that 

9 consists of individual retirement ac10 counts described in section 408 (in11 cluding by reason of subsection (c) 

12 thereof), whichever is applicable, and 

13 ‘‘(II) each participating employer 

14 takes such actions as the Secretary or 

15 such person determines are necessary 

16 for the plan to meet the requirements 

17 described in subclause (I), including 

18 providing to such person any disclo19 sures or other information which the 

20 Secretary may require or which such 

21 person otherwise determines is nec22 essary to administer the plan or to 

23 allow the plan to meet such require24 ments, 


dlhill on DSK3GLQ082PROD with BILLS
25 

•HR 4523 IH

1 ‘‘(ii) registers as a pooled plan pro2 vider with the Secretary, and provides such 

3 other information to the Secretary as the 

4 Secretary may require, before beginning 

5 operations as a pooled plan provider, 

6 ‘‘(iii) acknowledges in writing that 

7 such person is a named fiduciary (within 

8 the meaning of section 402(a)(2) of the 

9 Employee Retirement Income Security Act 

10 of 1974), and the plan administrator, with 

11 respect to the plan, and 

12 ‘‘(iv) is responsible for ensuring that 

13 all persons who handle assets of, or who 

14 are fiduciaries of, the plan are bonded in 

15 accordance with section 412 of the Em16 ployee Retirement Income Security Act of 

17 1974. 

18 ‘‘(B) AUDITS, EXAMINATIONS, AND INVES19 TIGATIONS.—The Secretary may perform au20 dits, examinations, and investigations of pooled 

21 plan providers as may be necessary to enforce 

22 and carry out the purposes of this subsection. 

23 ‘‘(4) GUIDANCE.— 

24 ‘‘(A) IN GENERAL.—The Secretary shall 

25 issue such guidance as the Secretary determines 


dlhill on DSK3GLQ082PROD with BILLS
26 

•HR 4523 IH

1 appropriate to carry out this subsection, includ2 ing guidance— 

3 ‘‘(i) to identify the administrative du4 ties and other actions required to be per5 formed by a pooled plan provider under 

6 this subsection, 

7 ‘‘(ii) which describes the procedures to 

8 be taken to terminate a plan which fails to 

9 meet the requirements to be a plan de10 scribed in paragraph (1), including the 

11 proper treatment of, and actions needed to 

12 be taken by, any participating employer of 

13 the plan and the assets and liabilities of 

14 the plan with respect to employees of that 

15 employer, and 

16 ‘‘(iii) identifying appropriate cases to 

17 which the rules of paragraph (2)(A) will 

18 apply to employers failing to take the ac19 tions described in paragraph (1). 

20 The Secretary shall take into account under 

21 clause (iii) whether the failure of an employer 

22 or pooled plan provider to provide any disclo23 sures or other information, or to take any other 

24 action, necessary to administer a plan or to 

25 allow a plan to meet requirements applicable to 


dlhill on DSK3GLQ082PROD with BILLS
27 

•HR 4523 IH

1 the plan under section 401(a) or 408, whichever 

2 is applicable, has continued over a period of 

3 time that clearly demonstrates a lack of com4 mitment to compliance. 

5 ‘‘(B) PROSPECTIVE APPLICATION.—Any 

6 guidance issued by the Secretary under this 

7 paragraph shall not apply to any action or fail8 ure occurring before the issuance of such guid9 ance. 

10 ‘‘(5) MODEL PLAN.—No later than June 30, 

11 2018, the Secretary shall, in consultation with the 

12 Secretary of Labor when appropriate, publish model 

13 plan language which meets the requirements of this 

14 subsection and of paragraphs (43) and (44) of sec15 tion 3 of the Employee Retirement Income Security 

16 Act of 1974 and which may be adopted in order for 

17 a plan to be treated as a plan described in para18 graph (1)(B). Such model plans shall also include 

19 options under which they can be used by plans that 

20 are not pooled employer plans.’’. 

21 (2) CONFORMING AMENDMENT.—Paragraph (3) 

22 of section 413(b) of such Code is amended by strik23 ing ‘‘section 401(a)’’ and inserting ‘‘sections 401(a) 

24 and 408(c)’’. 


dlhill on DSK3GLQ082PROD with BILLS
28 

•HR 4523 IH

1 (3) TECHNICAL AMENDMENT.—Subsection (c) 

2 of section 408 of such Code is amended by inserting 

3 after paragraph (2) the following new paragraph: 

4 ‘‘(3) There is a separate accounting for any in5 terest of an employee or member (or spouse of an 

6 employee or member) in a Roth IRA.’’. 

7 (b) NO COMMON INTEREST REQUIRED FOR POOLED

8 EMPLOYER PLANS.—Section 3(2) of the Employee Retire9 ment Income Security Act of 1974 (29 U.S.C. 1002(2)) 

10 is amended by adding at the end the following: 

11 ‘‘(C) A pooled employer plan shall be treat12 ed as— 

13 ‘‘(i) a single employee pension benefit 

14 plan or single pension plan, and 

15 ‘‘(ii) a plan to which section 210(a) 

16 applies.’’. 

17 (c) POOLED EMPLOYER PLAN AND PROVIDER DE18 FINED.— 

19 (1) IN GENERAL.—Section 3 of the Employee 

20 Retirement Income Security Act of 1974 (29 U.S.C. 

21 1002) is amended by adding at the end the fol22 lowing: 

23 ‘‘(43) POOLED EMPLOYER PLAN.— 

24 ‘‘(A) IN GENERAL.—The term ‘pooled em25 ployer plan’ means a plan— 


dlhill on DSK3GLQ082PROD with BILLS
29 

•HR 4523 IH

1 ‘‘(i) which is an individual account 

2 plan established or maintained for the pur3 pose of providing benefits to the employees 

4 of two or more employers; 

5 ‘‘(ii) which is a plan described in sec6 tion 401(a) of the Internal Revenue Code 

7 of 1986 which includes a trust exempt 

8 from tax under section 501(a) of such 

9 Code or a plan that consists of individual 

10 retirement accounts described in section 

11 408 of such Code (including by reason of 

12 subsection (c) thereof); and 

13 ‘‘(iii) the terms of which meet the re14 quirements of subparagraph (B). 

15 Such term shall not include a plan with respect 

16 to which all of the participating employers have 

17 both a common interest other than having 

18 adopted the plan and control of the plan. 

19 ‘‘(B) REQUIREMENTS FOR PLAN TERMS.— 

20 The requirements of this subparagraph are met 

21 with respect to any plan if the terms of the 

22 plan— 

23 ‘‘(i) designate a pooled plan provider 

24 and provide that the pooled plan provider 

25 is a named fiduciary of the plan; 


dlhill on DSK3GLQ082PROD with BILLS
30 

•HR 4523 IH

1 ‘‘(ii) designate one or more trustees 

2 meeting the requirements of section 

3 408(a)(2) of the Internal Revenue Code of 

4 1986 (other than a participating employer) 

5 to be responsible for collecting contribu6 tions to, and holding the assets of, the 

7 plan and require such trustees to imple8 ment written contribution collection proce9 dures that are reasonable, diligent, and 

10 systematic; 

11 ‘‘(iii) except as provided in section 

12 404(e), provide that each participating em13 ployer retains fiduciary responsibility for— 

14 ‘‘(I) the selection and monitoring 

15 in accordance with section 404(a) of 

16 the person designated as the pooled 

17 plan provider and any other person 

18 who, in addition to the pooled plan 

19 provider, is designated as a named fi20 duciary of the plan; and 

21 ‘‘(II) to the extent not otherwise 

22 delegated to another fiduciary by the 

23 pooled plan provider and subject to 

24 the provisions of section 404(c), the 

25 investment and management of that 


dlhill on DSK3GLQ082PROD with BILLS
31 

•HR 4523 IH

1 portion of the plan’s assets attrib2 utable to the employees of that par3 ticipating employer; 

4 ‘‘(iv) provide that a participating em5 ployer, or a participant or beneficiary, is 

6 not subject to unreasonable restrictions, 

7 fees, or penalties with regard to ceasing 

8 participation, receipt of distributions, or 

9 otherwise transferring assets of the plan in 

10 accordance with section 208 or paragraph 

11 (44)(C)(i)(II); 

12 ‘‘(v) require— 

13 ‘‘(I) the pooled plan provider to 

14 provide to participating employers any 

15 disclosures or other information which 

16 the Secretary may require, including, 

17 as applicable, any disclosures or other 

18 information to facilitate the selection 

19 or any monitoring of the pooled plan 

20 provider by participating employers; 

21 and 

22 ‘‘(II) each participating employer 

23 to take such actions as the Secretary 

24 or the pooled plan provider determines 

25 are necessary to administer the plan 


dlhill on DSK3GLQ082PROD with BILLS
32 

•HR 4523 IH

1 or for the plan to meet any require2 ment applicable under this Act or the 

3 Internal Revenue Code of 1986 to a 

4 plan described in section 401(a) of 

5 such Code or to a plan that consists 

6 of individual retirement accounts de7 scribed in section 408 of such Code 

8 (including by reason of subsection (c) 

9 thereof), whichever is applicable, in10 cluding providing any disclosures or 

11 other information which the Secretary 

12 may require or which the pooled plan 

13 provider otherwise determines is nec14 essary to administer the plan or to 

15 allow the plan to meet such require16 ments; and 

17 ‘‘(vi) provide that any disclosure or 

18 other information required to be provided 

19 under clause (v) may be provided in elec20 tronic form and will be designed to ensure 

21 only reasonable costs are imposed on 

22 pooled plan providers and participating 

23 employers. 

24 ‘‘(C) EXCEPTIONS.—The term ‘pooled em25 ployer plan’ does not include— 


dlhill on DSK3GLQ082PROD with BILLS
33 

•HR 4523 IH

1 ‘‘(i) a multiemployer plan; 

2 ‘‘(ii) a plan established before Janu3 ary 1, 2016, unless the plan administrator 

4 elects that the plan will be treated as a 

5 pooled employer plan and the plan meets 

6 the requirements of this title applicable to 

7 a pooled employer plan established on or 

8 after such date; and 

9 ‘‘(iii) a plan with respect to which all 

10 of the participating employers have both a 

11 common interest other than having adopt12 ed the plan and control of the plan. 

13 ‘‘(44) POOLED PLAN PROVIDER.— 

14 ‘‘(A) IN GENERAL.—The term ‘pooled plan 

15 provider’ means a person who— 

16 ‘‘(i) is designated by the terms of a 

17 pooled employer plan as a named fiduciary, 

18 as the plan administrator, and as the per19 son responsible for the performance of all 

20 administrative duties (including conducting 

21 proper testing with respect to the plan and 

22 employees of each participating employer) 

23 which are reasonably necessary to ensure 

24 that— 


dlhill on DSK3GLQ082PROD with BILLS
34 

•HR 4523 IH

1 ‘‘(I) the plan meets any require2 ment applicable under this Act or the 

3 Internal Revenue Code of 1986 to a 

4 plan described in section 401(a) of 

5 such Code or to a plan that consists 

6 of individual retirement accounts de7 scribed in section 408 of such Code 

8 (including by reason of subsection (c) 

9 thereof), whichever is applicable; and 

10 ‘‘(II) each participating employer 

11 takes such actions as the Secretary or 

12 pooled plan provider determines are 

13 necessary for the plan to meet the re14 quirements described in subclause (I), 

15 including providing the disclosures 

16 and information described in para17 graph (43)(B)(v)(II); 

18 ‘‘(ii) registers as a pooled plan pro19 vider with the Secretary, and provides to 

20 the Secretary such other information as 

21 the Secretary may require, before begin22 ning operations as a pooled plan provider; 

23 ‘‘(iii) acknowledges in writing that 

24 such person is a named fiduciary, and the 


dlhill on DSK3GLQ082PROD with BILLS
35 

•HR 4523 IH

1 plan administrator, with respect to the 

2 pooled employer plan; and 

3 ‘‘(iv) is responsible for ensuring that 

4 all persons who handle assets of, or who 

5 are fiduciaries of, the pooled employer plan 

6 are bonded in accordance with section 412. 

7 ‘‘(B) AUDITS, EXAMINATIONS, AND INVES8 TIGATIONS.—The Secretary may perform au9 dits, examinations, and investigations of pooled 

10 plan providers as may be necessary to enforce 

11 and carry out the purposes of this paragraph 

12 and paragraph (43). 

13 ‘‘(C) GUIDANCE.— 

14 ‘‘(i) IN GENERAL.—The Secretary 

15 shall issue such guidance as the Secretary 

16 determines appropriate to carry out this 

17 paragraph and paragraph (43), including 

18 guidance— 

19 ‘‘(I) to identify the administra20 tive duties and other actions required 

21 to be performed by a pooled plan pro22 vider under either such paragraph; 

23 and 

24 ‘‘(II) which requires in appro25 priate cases that if a participating 


dlhill on DSK3GLQ082PROD with BILLS
36 

•HR 4523 IH

1 employer fails to take the actions re2 quired under subparagraph 

3 (A)(i)(II)— 

4 ‘‘(aa) the assets of the plan 

5 attributable to employees of the 

6 participating employer are trans7 ferred to a plan maintained only 

8 by the participating employer (or 

9 its successor), to an eligible re10 tirement plan as defined in sec11 tion 402(c)(8)(B) of the Internal 

12 Revenue Code of 1986 for each 

13 individual whose account is 

14 transferred, or to any other ar15 rangement that the Secretary de16 termines is appropriate in such 

17 guidance; and 

18 ‘‘(bb) the participating em19 ployer described in item (aa) 

20 (and not the plan with respect to 

21 which the failure occurred or any 

22 other participating employer in 

23 such plan) shall, except to the ex24 tent provided in such guidance, 

25 be liable for any liabilities with 


dlhill on DSK3GLQ082PROD with BILLS
37 

•HR 4523 IH

1 respect to such plan attributable 

2 to employees of the participating 

3 employer. 

4 The Secretary shall take into account 

5 under subclause (II) whether the fail6 ure of an employer or pooled plan pro7 vider to provide any disclosures or 

8 other information, or to take any 

9 other action, necessary to administer 

10 a plan or to allow a plan to meet re11 quirements described in subparagraph 

12 (A)(i)(II) has continued over a period 

13 of time that clearly demonstrates a 

14 lack of commitment to compliance. 

15 The Secretary may waive the require16 ments of subclause (II)(aa) in appro17 priate circumstances if the Secretary 

18 determines it is in the best interests 

19 of the employees of the participating 

20 employer described in such clause to 

21 retain the assets in the plan with re22 spect to which the employer’s failure 

23 occurred. 

24 ‘‘(ii) PROSPECTIVE APPLICATION.— 

25 Any guidance issued by the Secretary 


dlhill on DSK3GLQ082PROD with BILLS
38 

•HR 4523 IH

1 under this subparagraph shall not apply to 

2 any action or failure occurring before the 

3 issuance of such guidance. 

4 ‘‘(D) AGGREGATION RULES.—For purposes 

5 of this paragraph— 

6 ‘‘(i) IN GENERAL.—In determining 

7 whether a person meets the requirements 

8 of this paragraph to be a pooled plan pro9 vider with respect to any plan, all persons 

10 who are members of the same controlled 

11 group and who perform services for the 

12 plan shall be treated as one person. 

13 ‘‘(ii) MEMBERS OF COMMON GROUP.— 

14 Persons shall be treated as members of the 

15 same controlled group if such persons are 

16 treated as a single employer under sub17 section (c) or (d) of section 210.’’. 

18 (2) BONDING REQUIREMENTS FOR POOLED EM19 PLOYER PLANS.—The last sentence of section 412(a) 

20 of the Employee Retirement Income Security Act of 

21 1974 (29 U.S.C. 1112(a)) is amended by inserting 

22 ‘‘or in the case of a pooled employer plan (as defined 

23 in section 3(43)’’ after ‘‘section 407(d)(1))’’. 

24 (3) CONFORMING AND TECHNICAL AMEND25 MENTS.—Section 3 of the Employee Retirement InVerDate Sep 11 2014 02:39 Dec 06, 2017 Jkt 079200 PO 00000 Frm 00038 Fmt 6652 Sfmt 6201 E:\BILLS\H4523.IH H4523

dlhill on DSK3GLQ082PROD with BILLS
39 

•HR 4523 IH

1 come Security Act of 1974 (29 U.S.C. 1002) is 

2 amended— 

3 (A) in paragraph (16)(B)— 

4 (i) by striking ‘‘or’’ at the end of 

5 clause (ii); and 

6 (ii) by striking the period at the end 

7 and inserting ‘‘, or (iv) in the case of a 

8 pooled employer plan, the pooled plan pro9 vider.’’; and 

10 (B) by striking the second paragraph (41). 

11 (d) EFFECTIVE DATE.— 

12 (1) IN GENERAL.—The amendments made by 

13 this section shall apply to years beginning after De14 cember 31, 2019. 

15 (2) RULE OF CONSTRUCTION.—Nothing in the 

16 amendments made by subsection (a) shall be con17 strued as limiting the authority of the Secretary of 

18 the Treasury or the Secretary’s delegate (determined 

19 without regard to such amendment) to provide for 

20 the proper treatment of a failure to meet any re21 quirement applicable under the Internal Revenue 

22 Code of 1986 with respect to one employer (and its 

23 employees) in a multiple employer plan. 


dlhill on DSK3GLQ082PROD with BILLS
40 

•HR 4523 IH

1 SEC. 6. LIMITATION ON EMPLOYER LIABILITY. 

2 Section 404 of the Employee Retirement Income Se3 curity Act of 1974 (29 U.S.C. 1021 et seq.) is amended 

4 by adding at the end the following: 

5 ‘‘(e)(1) An eligible employer (as defined in section 

6 408(p)(2)(C)(i) of the Internal Revenue Code of 1986) 

7 shall not be a fiduciary in any respect with respect to a 

8 pooled employer plan, including with respect to the selec9 tion or monitoring of any plan service provider or any in10 vestment under the plan, if the pooled plan provider— 

11 ‘‘(A) receives no more than reasonable com12 pensation for its services, as agreed to by the eligible 

13 employer, and 

14 ‘‘(B) agrees in the plan document to— 

15 ‘‘(i) comply with all requirements applica16 ble to a pooled plan provider under this title, 

17 and 

18 ‘‘(ii) assume, with respect to such eligible 

19 employer as agreed to by the eligible employer, 

20 all fiduciary responsibility with respect to the 

21 plan not retained by the eligible employer, and 

22 ‘‘(C) notifies the eligible employer of its obliga23 tions under the pooled employer plan. 

24 ‘‘(2) Notwithstanding paragraph (1), eligible employ25 ers participating in such a pooled employer plan shall be 

26 responsible for— 


dlhill on DSK3GLQ082PROD with BILLS
41 

•HR 4523 IH

1 ‘‘(A) meeting the enrollment requirements ap2 plicable to such employer under the plan, 

3 ‘‘(B) transmitting contributions to the plan in 

4 accordance with the terms of the plan, 

5 ‘‘(C) providing such information and assistance 

6 as is within the sole control of the eligible employer 

7 and is needed by the plan to operate in accordance 

8 with the plan document, and 

9 ‘‘(D) providing such other information or as10 sistance in accordance with regulations prescribed by 

11 the Secretary.’’. 

12 SEC. 7. PORTABILITY OF LIFETIME INCOME OPTIONS. 

13 (a) IN GENERAL.—Subsection (a) of section 401 of 

14 the Internal Revenue Code of 1986 is amended by insert15 ing after paragraph (37) the following new paragraph: 

16 ‘‘(38) PORTABILITY OF LIFETIME INCOME AND

17 MANAGED ACCOUNT OPTIONS.— 

18 ‘‘(A) IN GENERAL.—A trust forming part 

19 of a defined contribution plan shall not be 

20 treated as failing to constitute a qualified trust 

21 under this section solely by reason of allowing— 

22 ‘‘(i) qualified distributions of a life23 time income investment or a managed ac24 count investment, or 


dlhill on DSK3GLQ082PROD with BILLS
42 

•HR 4523 IH

1 ‘‘(ii) distributions of a lifetime income 

2 investment in the form of a qualified plan 

3 distribution annuity contract, 

4 on or after the date that is 90 days prior to the 

5 date on which such lifetime income investment 

6 or such managed account investment is no 

7 longer authorized to be held as an investment 

8 option under the plan except as may otherwise 

9 be provided by regulations. 

10 ‘‘(B) DEFINITIONS.—For purposes of this 

11 subsection— 

12 ‘‘(i) the term ‘qualified distribution’ 

13 means a direct trustee-to-trustee transfer 

14 to an eligible retirement plan (as defined 

15 in section 402(c)(8)(B)), as described in 

16 section 401(a)(31)(A), and in the case of a 

17 managed account investment, the eligible 

18 retirement plan must be maintained by the 

19 account manager of such managed account 

20 investment, 

21 ‘‘(ii) the term ‘lifetime income invest22 ment’ means an investment option that is 

23 designed to provide an employee with elec24 tion rights— 


dlhill on DSK3GLQ082PROD with BILLS
43 

•HR 4523 IH

1 ‘‘(I) that are not uniformly avail2 able with respect to other investment 

3 options under the plan, and 

4 ‘‘(II) that are to a lifetime in5 come feature available through a con6 tract or other arrangement offered 

7 under the plan or under another eligi8 ble retirement plan (as defined in sec9 tion 402(c)(8)(B)) through a direct 

10 trustee-to-trustee transfer to such 

11 other eligible retirement plan under 

12 section 401(a)(31)(A), 

13 ‘‘(iii) the term ‘lifetime income fea14 ture’ means— 

15 ‘‘(I) a feature that guarantees a 

16 minimum level of income annually (or 

17 more frequently) for at least the re18 mainder of the life of the employee or 

19 the joint lives of the employee and the 

20 employee’s designated beneficiary, or 

21 ‘‘(II) an annuity payable on be22 half of the employee under which pay23 ments are made in substantially equal 

24 periodic payments (not less frequently 

25 than annually) over the life of the emVerDate Sep 11 2014 02:39 Dec 06, 2017 Jkt 079200 PO 00000 Frm 00043 Fmt 6652 Sfmt 6201 E:\BILLS\H4523.IH H4523

dlhill on DSK3GLQ082PROD with BILLS
44 

•HR 4523 IH

1 ployee or the joint lives of the em2 ployee and the employee’s designated 

3 beneficiary, 

4 ‘‘(iv) the term ‘qualified plan distribu5 tion annuity contract’ means an annuity 

6 contract purchased for a participant and 

7 distributed to the participant by a plan de8 scribed in subparagraph (B) of section 

9 402(c)(8) (without regard to clauses (i) 

10 and (ii) thereof), 

11 ‘‘(v) the term ‘managed account in12 vestment’ means an investment option 

13 under which the assets of the employee’s 

14 individual account are managed by an ac15 count manager, applying generally accept16 ed investment theories, to achieve varying 

17 degrees of long-term appreciation and cap18 ital preservation based on the employee’s 

19 age, target retirement date or life expect20 ancy, 

21 ‘‘(vi) the term ‘account manager’ 

22 means an investment manager (within the 

23 meaning of section 3(38) of the Employee 

24 Retirement Income Security Act), and 


dlhill on DSK3GLQ082PROD with BILLS
45 

•HR 4523 IH

1 ‘‘(vii) a lifetime income investment or 

2 managed account investment is treated as 

3 no longer authorized to be held as an in4 vestment under the plan if such treatment 

5 applies to all plan participants or to a class 

6 of such participants, as determined in any 

7 reasonable manner.’’. 

8 (b) CASH OR DEFERRED ARRANGEMENT.—Clause (i) 

9 of section 401(k)(2)(B) of such Code is amended by strik10 ing ‘‘or’’ at the end of subclause (IV), by striking ‘‘and’’ 

11 at the end of subclause (V) and inserting ‘‘or’’, and by 

12 adding at the end of clause (i) the following: 

13 ‘‘(VI) with respect to amounts in14 vested in a lifetime income investment 

15 (as defined in section 

16 401(a)(38)(B)(ii)) or a managed ac17 count investment (as defined in sec18 tion 401(a)(38)(B)(v)), the date that 

19 is 90 days prior to the date that such 

20 lifetime income investment or such 

21 managed account investment may no 

22 longer be held as an investment option 

23 under the plan (within the meaning of 

24 section 401(a)(38)(B)(vii)), provided 

25 that any distribution under this subVerDate Sep 11 2014 02:39 Dec 06, 2017 Jkt 079200 PO 00000 Frm 00045 Fmt 6652 Sfmt 6201 E:\BILLS\H4523.IH H4523

dlhill on DSK3GLQ082PROD with BILLS
46 

•HR 4523 IH

1 clause must be in the form of a quali2 fied distribution (as defined in section 

3 401(a)(38)(B)(i)) or, in the case of a 

4 lifetime income investment, a qualified 

5 plan distribution annuity contract (as 

6 defined in section 401(a)(38)(B)(iv)), 

7 and’’. 

8 (c) SECTION 403(b) PLANS.— 

9 (1) ANNUITY CONTRACTS.—Paragraph (11) of 

10 section 403(b) of such Code is amended by striking 

11 ‘‘or’’ at the end of subparagraph (B), by striking the 

12 period at the end of subparagraph (C), and by in13 serting ‘‘, or’’, and by adding at the end the fol14 lowing: 

15 ‘‘(D) with respect to amounts invested in a 

16 lifetime income investment (as defined in sec17 tion 401(a)(38)(B)(ii)) or a managed account 

18 investment (as defined in section 

19 401(a)(38)(B)(v)), the date that is 90 days 

20 prior to the date that such lifetime income in21 vestment or such managed account investment 

22 may no longer be held as an investment option 

23 under the plan (within the meaning of section 

24 401(a)(38)(B)(vii)), provided that any distribu25 tion under this subparagraph must be in the 


dlhill on DSK3GLQ082PROD with BILLS
47 

•HR 4523 IH

1 form of a qualified distribution (as defined in 

2 section 401(a)(38)(B)(i)) or, in the case of a 

3 lifetime income investment, a qualified plan dis4 tribution annuity contract (as defined in section 

5 401(a)(38)(B)(iv)).’’. 

6 (2) CUSTODIAL ACCOUNTS.—Clause (ii) of sec7 tion 403(b)(7)(A) of such Code is amended to read 

8 as follows: 

9 ‘‘(ii) under the custodial account, no 

10 such amounts may be paid or made avail11 able to any distributee (unless such 

12 amount is a distribution to which section 

13 72(t)(2)(G) applies) before— 

14 ‘‘(I) the employee dies, 

15 ‘‘(II) the employee attains age 

591 16 ⁄2, 

17 ‘‘(III) the employee has a sever18 ance from employment, 

19 ‘‘(IV) the employee becomes dis20 abled (within the meaning of section 

21 72(m)(7)), 

22 ‘‘(V) in the case of contributions 

23 made pursuant to a salary reduction 

24 agreement (within the meaning of secVerDate Sep 11 2014 02:39 Dec 06, 2017 Jkt 079200 PO 00000 Frm 00047 Fmt 6652 Sfmt 6201 E:\BILLS\H4523.IH H4523

dlhill on DSK3GLQ082PROD with BILLS
48 

•HR 4523 IH

1 tion 3121(a)(5)(D)), the employee en2 counters financial hardship, or 

3 ‘‘(VI) with respect to amounts in4 vested in a lifetime income investment 

5 (as defined in section 

6 401(a)(38)(B)(ii)) or a managed ac7 count investment (as defined in sec8 tion 401(a)(38)(B)(v)), the date that 

9 is 90 days prior to the date that such 

10 lifetime income investment or such 

11 managed account investment may no 

12 longer be held as an investment option 

13 under the plan (within the meaning of 

14 section 401(a)(38)(B)(vii)), provided 

15 that any distribution under this sub16 paragraph must be in the form of a 

17 qualified distribution (as defined in 

18 section 401(a)(38)(B)(i)) or, in the 

19 case of a lifetime income investment, 

20 a qualified plan distribution annuity 

21 contract (as defined in section 

22 401(a)(38)(B)(iv)).’’. 

23 (d) ELIGIBLE DEFERRED COMPENSATION PLANS.— 

24 Subparagraph (A) of section 457(d)(1) of such Code is 

25 amended by striking ‘‘or’’ at the end of clause (ii), by inVerDate Sep 11 2014 02:39 Dec 06, 2017 Jkt 079200 PO 00000 Frm 00048 Fmt 6652 Sfmt 6201 E:\BILLS\H4523.IH H4523

dlhill on DSK3GLQ082PROD with BILLS
49 

•HR 4523 IH

1 serting ‘‘or’’ at the end of clause (iii), and by adding after 

2 clause (iii) the following: 

3 ‘‘(iv) with respect to amounts invested 

4 in a lifetime income investment (as defined 

5 in section 401(a)(38)(B)(ii)) or a managed 

6 account investment (as defined in section 

7 401(a)(38)(B)(v)), the date that is 90 days 

8 prior to the date that such lifetime income 

9 investment or such managed account in10 vestment may no longer be held as an in11 vestment option under the plan (within the 

12 meaning of section 401(a)(38)(B)(vii)), 

13 provided that any distribution under this 

14 subparagraph must be in the form of a 

15 qualified distribution (as defined in section 

16 401(a)(38)(B)(i)) or, in the case of a life17 time income investment, a qualified plan 

18 distribution annuity contract (as defined in 

19 section 401(a)(38)(B)(iv)),’’. 

20 (e) EFFECTIVE DATE.—The amendments made by 

21 this section shall apply to plan years beginning after De22 cember 31, 2017. 


dlhill on DSK3GLQ082PROD with BILLS
50 

•HR 4523 IH

1 SEC. 8. INCREASE IN CREDIT LIMITATION FOR SMALL EM2 PLOYER PENSION PLAN STARTUP COSTS. 

3 (a) IN GENERAL.—Paragraph (1) of section 45E(b) 

4 of the Internal Revenue Code of 1986 is amended to read 

5 as follows: 

6 ‘‘(1) for the first credit year and each of the 4 

7 taxable years immediately following the first credit 

8 year, the greater of— 

9 ‘‘(A) $500, or 

10 ‘‘(B) the lesser of— 

11 ‘‘(i) $250 for each employee of the eli12 gible employer who is not a highly com13 pensated employee (as defined in section 

14 414(q)) and who is eligible to participate 

15 in the eligible employer plan maintained by 

16 the eligible employer, or 

17 ‘‘(ii) $5,000, and’’. 

18 (b) SPECIAL RULE FOR EMPLOYERS WITH 25 OR

19 FEWER EMPLOYEES.—Subsection (a) of section 45E of 

20 such Code is amended by inserting before the period at 

21 the end the following: ‘‘(100 percent of such costs in the 

22 case of an eligible employer with 25 or fewer employees, 

23 as determined by substituting ‘25’ for ‘100’ in section 

24 408(p)(2)(C)(i))’’. 

25 (c) AUTOMATIC CONTRIBUTION PLAN.—Paragraph 

26 (2) of section 45E(d) of such Code is amended by striking 


dlhill on DSK3GLQ082PROD with BILLS
51 

•HR 4523 IH

1 ‘‘a qualified employer plan within the meaning of section 

2 4972(d)’’ and inserting ‘‘an automatic contribution plan 

3 within the meaning of section 414(aa)’’. 

4 (d) CONFORMING CHANGE.—Paragraph (2) of sec5 tion 45E(d) of such Code is amended by adding at the 

6 end thereof the following: ‘‘For purposes of this section, 

7 the term ‘qualified employer plan’ has the meaning given 

8 such term under section 4972(d).’’. 

9 (e) EFFECTIVE DATE.—The amendment made by 

10 this section shall apply to taxable years beginning after 

11 December 31, 2017. 

12 SEC. 9. SMALL EMPLOYER AUTOMATIC ENROLLMENT 

13 CREDIT. 

14 (a) IN GENERAL.—Subpart D of part IV of sub15 chapter A of chapter 1 of the Internal Revenue Code of 

16 1986 is amended by adding at the end the following new 

17 section: 

18 ‘‘SEC. 45S. AUTO-ENROLLMENT CREDIT FOR RETIREMENT 

19 SAVINGS OPTIONS PROVIDED BY SMALL EM20 PLOYERS. 

21 ‘‘(a) IN GENERAL.—For purposes of section 38, in 

22 the case of an eligible employer, the retirement auto-en23 rollment credit determined under this section for any tax24 able year is an amount equal to— 


dlhill on DSK3GLQ082PROD with BILLS
52 

•HR 4523 IH

1 ‘‘(1) $500 for any taxable year occurring during 

2 the credit period, and 

3 ‘‘(2) zero for any other taxable year. 

4 ‘‘(b) CREDIT PERIOD.—For purposes of subsection 

5 (a)— 

6 ‘‘(1) IN GENERAL.—The credit period with re7 spect to any eligible employer is the 5-taxable-year 

8 period beginning with the first taxable year for 

9 which the employer adopts an automatic contribu10 tion plan (as defined in section 414(aa)), determined 

11 without regard to a plan described in section 

12 414(aa)(2)(D) (relating to a grandfathered auto13 matic contribution plan). 

14 ‘‘(2) MAINTENANCE OF ARRANGEMENT.—No 

15 taxable year with respect to an employer shall be 

16 treated as occurring within the credit period unless 

17 the arrangement described in section 401(k)(14)(C) 

18 is included in the plan for such year. 

19 ‘‘(c) ELIGIBLE EMPLOYER.—For purposes of this 

20 section, the term ‘eligible employer’ has the meaning given 

21 such term in section 408(p)(2)(C)(i).’’. 

22 (b) CREDIT TO BE PART OF GENERAL BUSINESS

23 CREDIT.—Subsection (b) of section 38 of the Internal 

24 Revenue Code of 1986 is amended by striking ‘‘plus’’ at 

25 the end of paragraph (35), by striking the period at the 


dlhill on DSK3GLQ082PROD with BILLS
53 

•HR 4523 IH

1 end of paragraph (36) and inserting ‘‘, plus’’, and by add2 ing at the end the following new paragraph: 

3 ‘‘(37) in the case of an eligible employer (as de4 fined in section 45S(c)), the retirement auto-enroll5 ment credit determined under section 45S(a).’’. 

6 (c) CLERICAL AMENDMENT.—The table of sections 

7 for subpart D of part IV of subchapter A of chapter 1 

8 of the Internal Revenue Code of 1986 is amended by in9 serting after the item relating to section 45R the following 

10 new item: 

‘‘Sec. 45S. Auto-enrollment credit for retirement savings options provided by 

small employers.’’. 

11 (d) EFFECTIVE DATE.—The amendments made by 

12 this section shall apply to taxable years beginning after 

13 December 31, 2017. 

14 SEC. 10. TREATMENT OF AUTOMATIC CONTRIBUTION 

15 PLANS UNDER STATE LAW. 

16 (a) IN GENERAL.—Section 514 of the Employee Re17 tirement Income Security Act of 1974 (29 U.S.C. 1144) 

18 is amended by adding at the end the following: 

19 ‘‘(f) AUTOMATIC CONTRIBUTION PLANS.— 

20 ‘‘(1) IN GENERAL.—If an employer maintains 

21 an automatic contribution plan (as defined in section 

22 414(aa) of the Internal Revenue Code of 1986) that 

23 satisfies the requirements of section 414(aa)(3) 


dlhill on DSK3GLQ082PROD with BILLS
54 

•HR 4523 IH

1 (without regard to subparagraph (D) thereof), the 

2 employer— 

3 ‘‘(A) shall not be subject to any require4 ment imposed by a State or political subdivision 

5 thereof to contribute to an individual retirement 

6 plan (as defined in section 7701(a)(37) of the 

7 Internal Revenue Code of 1986) established and 

8 maintained pursuant to a payroll deduction sav9 ings program of a State or political subdivision 

10 thereof, and 

11 ‘‘(B) shall not be required to participate in 

12 any manner in such a payroll deduction savings 

13 program. 

14 ‘‘(2) QUALIFIED STATE LAW EXCEPTION.—This 

15 subsection shall not apply with respect to any em16 ployer to the extent that such employer participates 

17 in an arrangement under a qualified State law. 

18 ‘‘(3) QUALIFIED STATE LAW.—For purposes of 

19 this subsection— 

20 ‘‘(A) IN GENERAL.—The term ‘qualified 

21 State law’ means a State law that— 

22 ‘‘(i) was enacted before the date of en23 actment of the Automatic Retirement Plan 

24 Act of 2017, 


dlhill on DSK3GLQ082PROD with BILLS
55 

•HR 4523 IH

1 ‘‘(ii)(I) requires certain employers to 

2 contribute to, or participate in, an indi3 vidual retirement plan (as defined in sec4 tion 7701(a)(37) of such Code) established 

5 and maintained pursuant to a payroll de6 duction savings program of the State, or 

7 ‘‘(II) allows certain employers to con8 tribute to, or participate in, a plan de9 scribed in section 413(c) of such Code es10 tablished and maintained by the State, and 

11 ‘‘(iii) is not superseded by this title 

12 (determined without regard to this sub13 section). 

14 ‘‘(B) EXCEPTION.—If a State law de15 scribed in subparagraph (A)(ii) is amended 

16 after the date of enactment of the Automatic 

17 Retirement Plan Act of 2017 to materially ex18 pand the scope of the requirement described in 

19 subparagraph (A)(ii)(I) or the availability of a 

20 plan described in subparagraph (A)(ii)(II), the 

21 State law shall, as of the effective date of such 

22 amendment, cease to treated as a qualified 

23 State law.’’. 


dlhill on DSK3GLQ082PROD with BILLS
56 

•HR 4523 IH

1 (b) EFFECTIVE DATE.—The amendments made by 

2 this section shall apply to plan years beginning after De3 cember 31, 2017. 

4 SEC. 11. MATCHING PAYMENTS FOR ELECTIVE DEFERRAL 

5 AND IRA CONTRIBUTIONS BY CERTAIN INDI6 VIDUALS. 

7 (a) IN GENERAL.—Subchapter B of chapter 65 of the 

8 Internal Revenue Code of 1986 is amended by adding at 

9 the end the following new section: 

10 ‘‘SEC. 6433. MATCHING PAYMENTS FOR ELECTIVE DEFER11 RAL AND IRA CONTRIBUTIONS BY CERTAIN 

12 INDIVIDUALS. 

13 ‘‘(a) IN GENERAL.— 

14 ‘‘(1) ALLOWANCE OF CREDIT.—Any eligible in15 dividual who makes qualified retirement savings con16 tributions for the taxable year shall be allowed a 

17 credit for such taxable year in an amount equal to 

18 the applicable percentage of so much of the qualified 

19 retirement savings contributions made by such eligi20 ble individual for the taxable year as does not exceed 

21 $1,000. 

22 ‘‘(2) PAYMENT OF CREDIT.—The credit under 

23 this section shall be paid by the Secretary as a con24 tribution (as soon as practicable after the eligible in25 dividual has filed a tax return for the taxable year) 


dlhill on DSK3GLQ082PROD with BILLS
57 

•HR 4523 IH

1 to the applicable retirement vehicle of the eligible in2 dividual. 

3 ‘‘(b) APPLICABLE PERCENTAGE.—For purposes of 

4 this section— 

5 ‘‘(1) IN GENERAL.—Except as provided in para6 graph (2), the applicable percentage is 50 percent. 

7 ‘‘(2) PHASEOUT.—The percentage under para8 graph (1) shall be reduced (but not below zero) by 

9 the number of percentage points which bears the 

10 same ratio to 50 percentage points as— 

11 ‘‘(A) the excess of— 

12 ‘‘(i) the taxpayer’s modified adjusted 

13 gross income for such taxable year, over 

14 ‘‘(ii) the applicable dollar amount, 

15 bears to 

16 ‘‘(B) the phaseout range. 

17 If any reduction determined under this paragraph is 

18 not a whole percentage point, such reduction shall be 

19 rounded to the next lowest whole percentage point. 

20 ‘‘(3) APPLICABLE DOLLAR AMOUNT; PHASEOUT

21 RANGE.— 

22 ‘‘(A) JOINT RETURNS.—Except as pro23 vided in subparagraph (B)— 

24 ‘‘(i) the applicable dollar amount is 

25 $65,000, and 


dlhill on DSK3GLQ082PROD with BILLS
58 

•HR 4523 IH

1 ‘‘(ii) the phaseout range is $20,000. 

2 ‘‘(B) OTHER RETURNS.—In the case of— 

3 ‘‘(i) a head of a household (as defined 

4 in section 2(b)), the applicable dollar 

amount and the phaseout range shall be 3 5 ⁄4

6 of the amounts applicable under subpara7 graph (A) (as adjusted under subsection 

8 (g)), and 

9 ‘‘(ii) any taxpayer who is not filing a 

10 joint return and who is not a head of a 

11 household (as so defined), the applicable 

12 dollar amount and the phaseout range 

shall be 1 13 ⁄2 of the amounts applicable 

14 under subparagraph (A) (as so adjusted). 

15 ‘‘(c) ELIGIBLE INDIVIDUAL.—For purposes of this 

16 section— 

17 ‘‘(1) IN GENERAL.—The term ‘eligible indi18 vidual’ means any individual if such individual has 

19 attained the age of 18 as of the close of the taxable 

20 year. 

21 ‘‘(2) DEPENDENTS AND FULL-TIME STUDENTS

22 NOT ELIGIBLE.—The term ‘eligible individual’ shall 

23 not include— 

24 ‘‘(A) any individual with respect to whom 

25 a deduction under section 151 is allowed to anVerDate Sep 11 2014 02:39 Dec 06, 2017 Jkt 079200 PO 00000 Frm 00058 Fmt 6652 Sfmt 6201 E:\BILLS\H4523.IH H4523

dlhill on DSK3GLQ082PROD with BILLS
59 

•HR 4523 IH

1 other taxpayer for a taxable year beginning in 

2 the calendar year in which such individual’s 

3 taxable year begins, and 

4 ‘‘(B) any individual who is a student (as 

5 defined in section 152(f)(2)). 

6 ‘‘(d) QUALIFIED RETIREMENT SAVINGS CONTRIBU7 TIONS.—For purposes of this section— 

8 ‘‘(1) IN GENERAL.—The term ‘qualified retire9 ment savings contributions’ means, with respect to 

10 any taxable year, the sum of— 

11 ‘‘(A) the amount of the qualified retire12 ment contributions (as defined in section 

13 219(e)) made by the eligible individual, 

14 ‘‘(B) the amount of— 

15 ‘‘(i) any elective deferrals (as defined 

16 in section 402(g)(3)) of such individual, 

17 and 

18 ‘‘(ii) any elective deferral of com19 pensation by such individual under an eli20 gible deferred compensation plan (as de21 fined in section 457(b)) of an eligible em22 ployer described in section 457(e)(1)(A), 

23 and 


dlhill on DSK3GLQ082PROD with BILLS
60 

•HR 4523 IH

1 ‘‘(C) the amount of voluntary employee 

2 contributions by such individual to any qualified 

3 retirement plan (as defined in section 4974(c)). 

4 Such term shall not include any amount attributable 

5 to a payment under subsection (a). 

6 ‘‘(2) REDUCTION FOR CERTAIN DISTRIBU7 TIONS.— 

8 ‘‘(A) IN GENERAL.—The qualified retire9 ment savings contributions determined under 

10 paragraph (1) for a taxable year shall be re11 duced (but not below zero) by the aggregate 

12 distributions received by the individual during 

13 the testing period from any entity of a type to 

14 which contributions under paragraph (1) may 

15 be made. 

16 ‘‘(B) TESTING PERIOD.—For purposes of 

17 subparagraph (A), the testing period, with re18 spect to a taxable year, is the period which in19 cludes— 

20 ‘‘(i) such taxable year, 

21 ‘‘(ii) the 2 preceding taxable years, 

22 and 

23 ‘‘(iii) the period after such taxable 

24 year and before the due date (including exVerDate Sep 11 2014 02:39 Dec 06, 2017 Jkt 079200 PO 00000 Frm 00060 Fmt 6652 Sfmt 6201 E:\BILLS\H4523.IH H4523

dlhill on DSK3GLQ082PROD with BILLS
61 

•HR 4523 IH

1 tensions) for filing the return of tax for 

2 such taxable year. 

3 ‘‘(C) EXCEPTED DISTRIBUTIONS.—There 

4 shall not be taken into account under subpara5 graph (A)— 

6 ‘‘(i) any distribution referred to in 

7 section 72(p), 401(k)(8), 401(m)(6), 

8 402(g)(2), 404(k), or 408(d)(4), 

9 ‘‘(ii) any distribution to which section 

10 408(d)(3) or 408A(d)(3) applies, and 

11 ‘‘(iii) any portion of a distribution if 

12 such portion is transferred or paid in a 

13 rollover contribution (as defined in section 

14 402(c), 403(a)(4), 403(b)(8), 408A(e), or 

15 457(e)(16)) to an account or plan to which 

16 qualified retirement contributions can be 

17 made. 

18 ‘‘(D) TREATMENT OF DISTRIBUTIONS RE19 CEIVED BY SPOUSE OF INDIVIDUAL.—For pur20 poses of determining distributions received by 

21 an individual under subparagraph (A) for any 

22 taxable year, any distribution received by the 

23 spouse of such individual shall be treated as re24 ceived by such individual if such individual and 

25 spouse file a joint return for such taxable year 


dlhill on DSK3GLQ082PROD with BILLS
62 

•HR 4523 IH

1 and for the taxable year during which the 

2 spouse receives the distribution. 

3 ‘‘(e) APPLICABLE RETIREMENT SAVINGS VEHI4 CLE.— 

5 ‘‘(1) IN GENERAL.—The term ‘applicable retire6 ment savings vehicle’ means— 

7 ‘‘(A) an account or plan elected by the eli8 gible individual under paragraph (2), or 

9 ‘‘(B) if no such election is made, a retire10 ment bond purchased by the Secretary for the 

11 benefit of the eligible individual. 

12 ‘‘(2) OTHER RETIREMENT VEHICLES.—An eligi13 ble individual may elect to have the amount deter14 mined under subsection (a) contributed to an ac15 count or plan which— 

16 ‘‘(A) is a Roth IRA (as defined in section 

17 408A), or a designated Roth account (within 

18 the meaning of section 402A) of an applicable 

19 retirement plan (as defined in section 

20 402A(e)(1)), 

21 ‘‘(B) is for the benefit of the eligible indi22 vidual, 

23 ‘‘(C) accepts contributions made under this 

24 section, and 


dlhill on DSK3GLQ082PROD with BILLS
63 

•HR 4523 IH

1 ‘‘(D) is designated by such individual (in 

2 such form and manner as the Secretary may 

3 provide) on the return of tax for the taxable 

4 year. 

5 ‘‘(3) RETIREMENT BOND.— 

6 ‘‘(A) IN GENERAL.—For purposes of this 

7 section, the term ‘retirement bond’ means a 

8 bond issued under chapter 31 of title 31, 

9 United States Code, which by its terms, or by 

10 regulations prescribed by the Secretary under 

11 such chapter— 

12 ‘‘(i) provides for interest to be cred13 ited at rates that take into account the ex14 pected duration of the funds invested in re15 tirement bonds and at rates determined or 

16 adjusted in a manner and with sufficient 

17 frequency to provide substantial protection 

18 from inflation, 

19 ‘‘(ii) is not transferable, and 

20 ‘‘(iii) is designed for investment for 

21 retirement. 

22 ‘‘(B) ROTH IRA RULES APPLICABLE.—The 

23 provisions of this title applicable to a Roth IRA, 

24 including provisions relating to contributions, 

25 holding and distributions, shall apply to a reVerDate Sep 11 2014 02:39 Dec 06, 2017 Jkt 079200 PO 00000 Frm 00063 Fmt 6652 Sfmt 6201 E:\BILLS\H4523.IH H4523

dlhill on DSK3GLQ082PROD with BILLS
64 

•HR 4523 IH

1 tirement bond, except as determined by the Sec2 retary. 

3 ‘‘(C) REGULATIONS.—The Secretary may 

4 issue such regulations as are necessary to carry 

5 out the purposes of this section, including— 

6 ‘‘(i) establishment of procedures to 

7 communicate to individuals the importance 

8 of investment diversification and the trans9 fer option described in clause (ii), 

10 ‘‘(ii) simplified procedures under 

11 which holders of retirement bonds may pe12 riodically choose to have the bonds or their 

13 proceeds transferred to available Roth 

14 IRAs, and 

15 ‘‘(iii) means by which individuals may 

16 elect (or be treated as electing) whether to 

17 have retirement bonds or their proceeds so 

18 transferred. 

19 Any such transfer shall be treated as a rollover 

20 contribution for purposes of section 408(d)(3) 

21 (other than subparagraph (B) thereof). 

22 ‘‘(f) OTHER DEFINITIONS AND SPECIAL RULES.— 

23 ‘‘(1) MODIFIED ADJUSTED GROSS INCOME.— 

24 For purposes of this section, the term ‘modified ad25 justed gross income’ means adjusted gross income— 


dlhill on DSK3GLQ082PROD with BILLS
65 

•HR 4523 IH

1 ‘‘(A) determined without regard to sections 

2 911, 931, and 933, and 

3 ‘‘(B) determined without regard to any ex4 clusion or deduction allowed for any qualified 

5 retirement savings contribution made during 

6 the taxable year. 

7 ‘‘(2) TREATMENT OF CONTRIBUTIONS.—In the 

8 case of any contribution under subsection (a)(2)— 

9 ‘‘(A) except as otherwise provided in this 

10 section or by the Secretary under regulations, 

11 such contribution shall be treated in the same 

12 manner as a contribution made by the indi13 vidual on whose behalf such contribution was 

14 made, 

15 ‘‘(B) such contribution shall not be treated 

16 as income to the taxpayer, and 

17 ‘‘(C) such contribution shall not be taken 

18 into account with respect to any applicable limi19 tation under sections 402(g)(1), 403(b), 

20 408(a)(1), 408(b)(2)(B), 408A(c)(2), 414(v)(2), 

21 415(c), or 457(b)(2). 

22 ‘‘(3) TREATMENT OF QUALIFIED PLANS, ETC.— 

23 A plan or arrangement to which a contribution is 

24 made under this section shall not be treated as vio25 lating any requirement under section 401, 403, 408, 


dlhill on DSK3GLQ082PROD with BILLS
66 

•HR 4523 IH

1 or 457 solely by reason of accepting such contribu2 tion. 

3 ‘‘(4) ERRONEOUS CREDITS.—If any contribu4 tion is erroneously paid under subsection (a)(2), the 

5 amount of such erroneous payment shall be treated 

6 as an underpayment of tax. 

7 ‘‘(g) INFLATION ADJUSTMENTS.— 

8 ‘‘(1) IN GENERAL.—In the case of any taxable 

9 year beginning in a calendar year after 2018, each 

10 of the dollar amounts in subsections (a)(2) and 

11 (b)(3)(A)(i) shall be increased by an amount equal 

12 to— 

13 ‘‘(A) such dollar amount, multiplied by 

14 ‘‘(B) the cost-of-living adjustment deter15 mined under section 1(f)(3) for the calendar 

16 year in which the taxable year begins, deter17 mined by substituting ‘calendar year 2017’ for 

18 ‘calendar year 1992’ in subparagraph (B) 

19 thereof. 

20 ‘‘(2) ROUNDING.—Any increase determined 

21 under paragraph (1) shall be rounded to the nearest 

22 multiple of— 

23 ‘‘(A) $100 in the case of an adjustment of 

24 the amount in subsection (a)(2), and 


dlhill on DSK3GLQ082PROD with BILLS
67 

•HR 4523 IH

1 ‘‘(B) $1,000 in the case of an adjustment 

2 of the amount in subsection (b)(3)(A)(i).’’. 

3 (b) PROMOTION AND GUIDANCE.— 

4 (1) PROMOTION.—The Secretary of the Treas5 ury (or the Secretary’s delegate) shall educate tax6 payers on the benefits provided under section 6433 

7 of the Internal Revenue Code of 1986. 

8 (2) GUIDANCE.—Not later than December 31, 

9 2017, the Secretary of the Treasury (or the Sec10 retary’s delegate) shall issue guidance on the imple11 mentation and administration of the amendments 

12 made by this section. 

13 (c) PAYMENT AUTHORITY.—Section 1324(b)(2) of 

14 title 31, United States Code, is amended by striking ‘‘or 

15 6431’’ and inserting ‘‘6431, or 6433’’. 

16 (d) DEFICIENCIES.—Section 6211(b)(4) is amended 

17 by striking ‘‘and 6431’’ and inserting ‘‘6431, and 6433’’. 

18 (e) CONFORMING AMENDMENTS.— 

19 (1) Section 25B of the Internal Revenue Code 

20 of 1986 is amended by striking subsections (a) 

21 through (f) and inserting the following: 

22 ‘‘For payment of credit related to qualified retire23 ment savings contributions, see section 6433.’’. 


dlhill on DSK3GLQ082PROD with BILLS
68 

•HR 4523 IH

1 (2) The table of sections for subchapter B of 

2 chapter 65 of such Code is amended by adding at 

3 the end the following new item: 

‘‘Sec. 6433. Matching payments for elective deferral and IRA contributions by 

certain individuals.’’. 

4 (f) EFFECTIVE DATE.—The amendments made by 

5 this section shall apply to taxable years beginning after 

6 December 31, 2017. 

7 SEC. 12. AUTHORITY TO REQUIRE REPORTING. 

8 (a) REPORTING UNDER INTERNAL REVENUE

9 CODE.—Subsection (a) of section 6058 of the Internal 

10 Revenue Code of 1986 is amended by adding at the end 

11 thereof the following: ‘‘The Secretary may by regulation 

12 require the inclusion in such annual return of such infor13 mation as may be necessary or appropriate to determine 

14 the effects of the alternative methods of satisfying applica15 ble nondiscrimination requirements, which are described 

16 in subsections (k)(13), (k)(14), (m)(11), and (m)(12) of 

17 section 401, on the contribution levels of employees who 

18 are not highly compensated employees (as defined in sec19 tion 414(q)).’’. 

20 (b) REPORTING UNDER EMPLOYEE RETIREMENT IN21 COME SECURITY ACT OF 1974.—Section 104(a)(2)(A) of 

22 the Employee Retirement Income Security Act of 1974 

23 (29 U.S.C. 1042(a)(2)), as amended by section 3(c), is 

24 further amended by inserting before the period at the end 


dlhill on DSK3GLQ082PROD with BILLS
69 

•HR 4523 IH

1 thereof the following: ‘‘, except that in the case of such 

2 a deferral-only arrangement contained in a pension plan 

3 with at least 100 participants, the Secretary may require 

4 such reporting as is necessary or appropriate with respect 

5 to service providers, investment options, and fees, but not 

6 in excess of any reporting applicable to other arrange7 ments.’’. 

Æ 


dlhill on DSK3GLQ082PROD with BILLS