I 

117TH CONGRESS 

1ST SESSION H. R. 2927 

To amend the Internal Revenue Code of 1986 and the Employee Retirement 

Income Security Act of 1974 to improve rules relating to retirement plans. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 30, 2021 

Mr. KIND (for himself, Mr. KELLY of Pennsylvania, and Mr. SMITH of Missouri) introduced the following bill; which was referred to the Committee 

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

Labor, 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 and the Employee Retirement Income Security Act of 1974 to improve rules relating to retirement plans. 

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. 

4 This Act may be cited as the ‘‘Savings for All Voca5 tions Enhancement Act of 2021’’ or the ‘‘SAVE Act of 

6 2021’’. 


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1 SEC. 2. MULTIPLE EMPLOYER 403(b) PLANS. 

2 (a) IN GENERAL.—Section 403(b) of the Internal 

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

4 the following new paragraph: 

5 ‘‘(15) MULTIPLE EMPLOYER PLANS.— 

6 ‘‘(A) IN GENERAL.—Except in the case of 

7 a church plan, this subsection shall not be 

8 treated as failing to apply to an annuity con9 tract solely by reason of such contract being 

10 purchased under a plan maintained by more 

11 than 1 employer. 

12 ‘‘(B) TREATMENT OF EMPLOYERS FAILING

13 TO MEET REQUIREMENTS OF PLAN.— 

14 ‘‘(i) IN GENERAL.—In the case of a 

15 plan maintained by more than 1 employer, 

16 this subsection shall not be treated as fail17 ing to apply to an annuity contract held 

18 under such plan merely because of one or 

19 more employers failing to meet the require20 ments of this subsection if such plan satis21 fies rules similar to the rules of section 

22 413(e)(2) with respect to any such em23 ployer failure. 

24 ‘‘(ii) ADDITIONAL REQUIREMENTS IN

25 CASE OF NON-GOVERNMENTAL PLANS.—A 

26 plan shall not be treated as meeting the reVerDate Sep 11 2014 16:44 Jun 23, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H2927.IH H2927

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1 quirements of this subparagraph unless the 

2 plan meets the requirements of subpara3 graph (A) or (B) of section 413(e)(1), ex4 cept in the case of a multiple employer 

5 plan maintained solely by any of the fol6 lowing: A State, a political subdivision of a 

7 State, or an agency or instrumentality of 

8 any one or more of the foregoing.’’. 

9 (b) ANNUAL REGISTRATION FOR 403(b) MULTIPLE

10 EMPLOYER PLAN.—Section 6057 of such Code is amend11 ed by redesignating subsection (g) as subsection (h) and 

12 by inserting after subsection (f) the following new sub13 section: 

14 ‘‘(g) 403(b) MULTIPLE EMPLOYER PLANS TREATED

15 AS ONE PLAN.—In the case of annuity contracts to which 

16 this section applies and to which section 403(b) applies 

17 by reason of the plan under which such contracts are pur18 chased meeting the requirements of paragraph (15) there19 of, such plan shall be treated as a single plan for purposes 

20 of this section.’’. 

21 (c) ANNUAL INFORMATION RETURNS FOR 403(b) 

22 MULTIPLE EMPLOYER PLAN.—Section 6058 of the Inter23 nal Revenue Code of 1986 is amended by redesignating 

24 subsection (f) as subsection (g) and by inserting after sub25 section (e) the following new subsection: 


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1 ‘‘(f) 403(b) MULTIPLE EMPLOYER PLANS TREATED

2 AS ONE PLAN.—In the case of annuity contracts to which 

3 this section applies and to which section 403(b) applies 

4 by reason of the plan under which such contracts are pur5 chased meeting the requirements of paragraph (15) there6 of, such plan shall be treated as a single plan for purposes 

7 of this section.’’. 

8 (d) AMENDMENTS TO EMPLOYEE RETIREMENT IN9 COME SECURITY ACT OF 1974.— 

10 (1) TREATED AS POOLED EMPLOYER PLAN.— 

11 (A) IN GENERAL.—Section 3(43)(A) of the 

12 Employee Retirement Income Security Act of 

13 1974 is amended— 

14 (i) in clause (ii), by striking ‘‘section 

15 501(a) of such Code or’’ and inserting 

16 ‘‘501(a) of such Code, a plan that consists 

17 of contracts described in section 403(b) of 

18 such Code, or’’; and 

19 (ii) in the flush text at the end, by 

20 striking ‘‘the plan.’’ and inserting ‘‘the 

21 plan, but such term shall include any pro22 gram (other than a governmental plan) 

23 maintained for the benefit of the employees 

24 of more than 1 employer that consists of 

25 contracts described in section 403(b) of 


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1 such Code and that meets the require2 ments of subparagraph (A) or (B) of sec3 tion 413(e)(1) of such Code.’’. 

4 (B) CONFORMING AMENDMENTS.—Sec5 tions 3(43)(B)(v)(II) and 3(44)(A)(i)(I) of such 

6 Act are each amended by striking ‘‘section 

7 401(a) of such Code or’’ and inserting ‘‘401(a) 

8 of such Code, a plan that consists of contracts 

9 described in section 403(b) of such Code, or’’. 

10 (2) FIDUCIARIES.—Section 3(43)(B)(ii) of such 

11 Act is amended— 

12 (A) by striking ‘‘trustees meeting the re13 quirements of section 408(a)(2) of the Internal 

14 Revenue Code of 1986’’ and inserting ‘‘trustees 

15 (or other fiduciaries in the case of a plan that 

16 consists of contracts described in section 403(b) 

17 of the Internal Revenue Code of 1986) meeting 

18 the requirements of section 408(a)(2) of such 

19 Code’’, and 

20 (B) by striking ‘‘holding’’ and inserting 

21 ‘‘holding (or causing to be held under the terms 

22 of a plan consisting of such contracts)’’. 

23 (e) REGULATIONS RELATING TO PLAN TERMI24 NATION.—The Secretary of the Treasury (or the Sec25 retary’s designee) shall prescribe such regulations as may 


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1 be necessary to clarify the treatment of a plan termination 

2 by an employer in the case of plans to which section 

3 403(b)(15) of such Code applies. 

4 (f) MODIFICATION OF MODEL PLAN LANGUAGE, 

5 ETC.— 

6 (1) PLAN NOTIFICATIONS.—The Secretary of 

7 the Treasury (or the Secretary’s designee) shall 

8 modify the model plan language published under sec9 tion 413(e)(5) of the Internal Revenue Code of 1986 

10 to include language which notifies participating em11 ployers which are exempt from tax under section 

12 501(a) of such Code that the plan is subject to the 

13 Employee Retirement Income Security Act of 1974 

14 and that such employer is a plan sponsor with re15 spect to its employees participating in the multiple 

16 employer plan and, as such, has certain fiduciary 

17 duties with respect to the plan and to its employees. 

18 (2) MODEL PLANS FOR MULTIPLE EMPLOYER

19 403(b) NON-GOVERNMENTAL PLANS.—For plans to 

20 which section 403(b)(15)(A) of the Internal Revenue 

21 Code of 1986 applies (other than a plan maintained 

22 for its employees by a State, a political subdivision 

23 of a State, or an agency or instrumentality of any 

24 one or more of the foregoing) the Secretary shall 

25 publish model plan language similar to model plan 


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1 language published under section 413(e)(5) of such 

2 Code. 

3 (3) EDUCATIONAL OUTREACH TO EMPLOYERS

4 EXEMPT FROM TAX.—The Secretary shall provide 

5 education and outreach to increase awareness to em6 ployers which are exempt from tax under section 

7 501(a) of such Code that multiple employer plans 

8 are subject to the Employee Retirement Income Se9 curity Act of 1974 and that such employer is a plan 

10 sponsor with respect to its employees participating 

11 in the multiple employer plan and, as such, has cer12 tain fiduciary duties with respect to the plan and to 

13 its employees. 

14 (g) NO INFERENCE WITH RESPECT TO CHURCH

15 PLANS.—Regarding any application of section 403(b) of 

16 the Internal Revenue Code of 1986 to an annuity contract 

17 purchased under a church plan (as defined in section 

18 414(e) of such Code) maintained by more than 1 em19 ployer, or to any application of rules similar to section 

20 413(e) of such Code to such a plan, no inference shall 

21 be made from section 403(b)(15)(A) of such Code (as 

22 added by this Act) not applying to such plans. 

23 (h) EFFECTIVE DATE.— 


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

2 this section shall apply to plan years beginning after 

3 December 31, 2021. 

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

5 amendments made by subsection (a) shall be con6 strued as limiting the authority of the Secretary of 

7 the Treasury or the Secretary’s delegate (determined 

8 without regard to such amendment) to provide for 

9 the proper treatment of a failure to meet any re10 quirement applicable under such Code with respect 

11 to one employer (and its employees) in the case of 

12 a plan to which section 403(b)(15) applies. 

13 SEC. 3. APPLICATION OF CREDIT FOR SMALL EMPLOYER 

14 PENSION PLAN STARTUP COSTS TO EMPLOY15 ERS WHICH JOIN AN EXISTING PLAN. 

16 (a) IN GENERAL.—Section 45E(d)(3)(A) of the In17 ternal Revenue Code of 1986 is amended by striking ‘‘ef18 fective’’ and inserting ‘‘effective with respect to the eligible 

19 employer’’. 

20 (b) EFFECTIVE DATE.—The amendment made by 

21 this section shall apply to eligible employer plans which 

22 become effective with respect to the eligible employer after 

23 the date of the enactment of this Act. 

24 SEC. 4. FINDINGS RELATING TO S CORPORATION ESOPs. 

25 Congress finds the following: 


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1 (1) On January 1, 1998, nearly 25 years after 

2 the Employee Retirement Income Security Act of 

3 1974 was enacted and the employee stock ownership 

4 plan (hereafter in this section referred to as an 

5 ‘‘ESOP’’) was created, employees were first per6 mitted to be owners of subchapter S corporations 

7 pursuant to the Small Business Job Protection Act 

8 of 1996 (Public Law 104–188). 

9 (2) With the passage of the Taxpayer Relief 

10 Act of 1997 (Public Law 105–34), Congress de11 signed incentives to encourage businesses to become 

12 ESOP-owned S corporations. 

13 (3) Since that time, several thousand companies 

14 have become ESOP-owned S corporations, creating 

15 an ownership interest for several million Americans 

16 in companies in every State in the country, in indus17 tries ranging from heavy manufacturing to construc18 tion and contracting to services. 

19 (4) Every United States worker who is an em20 ployee-owner of an S corporation company through 

21 an ESOP has a valuable qualified retirement savings 

22 account. 

23 (5) Recent studies have shown that employees 

24 of ESOP-owned S corporations enjoy greater job 

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1 parable companies; and ESOP companies are better 

2 able to weather economic downturns. 

3 (6) Studies also show that employee-owners of 

4 S corporation ESOP companies have amassed mean5 ingful retirement savings through their ESOP ac6 counts that will give them the means to retire with 

7 dignity. 

8 (7) It is the goal of Congress to preserve and 

9 foster employee ownership of S corporations through 

10 ESOPs. 

11 SEC. 5. REDUCTION IN EXCISE TAX ON CERTAIN ACCUMU12 LATIONS IN QUALIFIED RETIREMENT PLANS. 

13 (a) IN GENERAL.—Section 4974(a) of the Internal 

14 Revenue Code of 1986 is amended by striking ‘‘50 per15 cent’’ and inserting ‘‘25 percent’’. 

16 (b) REDUCTION IN EXCISE TAX ON FAILURES TO

17 TAKE REQUIRED MINIMUM DISTRIBUTIONS.—Section 

18 4974 of such Code is amended by adding at the end the 

19 following new subsection: 

20 ‘‘(e) REDUCTION OF TAX IN CERTAIN CASES.— 

21 ‘‘(1) REDUCTION.—In the case of a taxpayer 

22 who— 

23 ‘‘(A) corrects, during the correction win24 dow, a shortfall of distributions from an indiVerDate Sep 11 2014 16:44 Jun 23, 2021 Jkt 019200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H2927.IH H2927

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1 vidual retirement plan which resulted in imposi2 tion of a tax under subsection (a), and 

3 ‘‘(B) submits a return, during the correc4 tion window, reflecting such tax (as modified by 

5 this subsection), 

6 the first sentence of subsection (a) shall be applied 

7 by substituting ‘10 percent’ for ‘25 percent’. 

8 ‘‘(2) CORRECTION WINDOW.—For purposes of 

9 this subsection, the term ‘correction window’ means 

10 the period of time beginning on the date on which 

11 the tax under subsection (a) is imposed with respect 

12 to a shortfall of distributions from an individual re13 tirement plan, and ending on the earlier of— 

14 ‘‘(A) the date on which the Secretary initi15 ates an audit, or otherwise demands payment, 

16 with respect to the shortfall of distributions, or 

17 ‘‘(B) the last day of the second taxable 

18 year that begins after the end of the taxable 

19 year in which the tax under subsection (a) is 

20 imposed.’’. 

21 (c) EFFECTIVE DATE.—The amendments made by 

22 this section shall apply to taxable years beginning after 

23 December 31, 2021. 


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1 SEC. 6. INDIVIDUAL RETIREMENT PLAN STATUTE OF LIMI2 TATIONS FOR EXCISE TAX ON EXCESS CON3 TRIBUTIONS AND CERTAIN ACCUMULATIONS. 

4 Section 6501(l) of the Internal Revenue Code of 1986 

5 is amended by adding at the end the following new para6 graph: 

7 ‘‘(4) INDIVIDUAL RETIREMENT PLANS.— 

8 ‘‘(A) IN GENERAL.—For purposes of any 

9 tax imposed by section 4973 or 4974 in connec10 tion with an individual retirement plan, the re11 turn referred to in this section shall be the in12 come tax return filed by the person on whom 

13 the tax under such section is imposed for the 

14 year in which the act (or failure to act) giving 

15 rise to the liability for such tax occurred. 

16 ‘‘(B) RULE IN CASE OF INDIVIDUALS NOT

17 REQUIRED TO FILE RETURN.—In the case of a 

18 person who is not required to file an income tax 

19 return for such year— 

20 ‘‘(i) the return referred to in this sec21 tion shall be the income tax return that 

22 such person would have been required to 

23 file but for the fact that such person was 

24 not required to file such return, and 

25 ‘‘(ii) the 3-year period referred to in 

26 subsection (a) with respect to the return 


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1 shall be deemed to begin on the date by 

2 which the return would have been required 

3 to be filed (excluding any extension there4 of).’’. 

Æ 


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