I 
119TH CONGRESS 
1ST SESSION H. R. 6324 
To amend the Internal Revenue Code of 1986 to provide for in-service 
rollovers for individual retirement annuity purchases. 
IN THE HOUSE OF REPRESENTATIVES 
NOVEMBER 28, 2025 
Mr. PANETTA (for himself, Mr. LAHOOD, Mr. MILLER of Ohio, Mr. 
FITZPATRICK, Mr. DAVIS of Illinois, Mr. MORAN, Ms. DELBENE, and Mr. 
SCHNEIDER) introduced the following bill; which was referred to the 
Committee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to provide 
for in-service rollovers for individual retirement annuity 
purchases. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Retirement Simplifica-
tion and Clarity Act’’. 
SEC. 2. IN-SERVICE ROLLOVERS FOR ANNUITY PURCHASES. 
(a) IN GENERAL.—Section 401(k) of the Internal 
Revenue Code of 1986 is amended by adding at the end 
the following new paragraph: 
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‘‘(17) SPECIAL
RULE
FOR
PRE-RETIREMENT 
ROLLOVER.—Notwithstanding the requirements of 
paragraph (2)(B)(i), a plan may permit a partici-
pant who has attained age 50 or older to elect a di-
rect rollover of all or a portion the accrued benefit 
of the participant attributable to employer contribu-
tions made pursuant to the employee’s election to an 
individual retirement annuity (as defined in section 
408(b)).’’. 
(b) SAFE HARBOR.—Section 402(f) of such Code is 
amended by redesignating paragraph (2) as paragraph (3) 
and by inserting after paragraph (1) the following new 
paragraph: 
‘‘(2) SAFE HARBOR.— 
‘‘(A) IN GENERAL.—A written explanation 
shall satisfy the requirements of paragraph (1) 
if it includes the following information in con-
cise, plain language: 
‘‘(i) The taxpayer has 30 days to re-
view such explanation before they must 
take any action. 
‘‘(ii) Distributions made directly to 
the taxpayer will be subject to income tax 
withholding and added to gross income to 
the extent taxable. 
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‘‘(iii) The taxpayer may owe an addi-
tional 10 percent tax on a distribution 
issued before the taxpayer attains age 
591⁄2. 
‘‘(iv) A 20 percent income tax with-
holding will apply to distributions that are 
not eligible for rollover. 
‘‘(v) A taxpayer can defer Federal in-
come tax on eligible distributions by rolling 
such distribution over to another qualified 
plan or individual retirement arrangement. 
‘‘(vi) A taxpayer may not rollover— 
‘‘(I) required minimum distribu-
tions, 
‘‘(II) hardship distributions, 
‘‘(III) a series of payments to be 
made over a number of years, 
‘‘(IV) employee stock ownership 
plan dividends, or 
‘‘(V) corrective distributions. 
‘‘(vii) The plan administrator can be 
contacted for information regarding wheth-
er all or a portion of a payment to the tax-
payer is eligible for rollover. 
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‘‘(viii) A plan may require the tax-
payer to take a distribution upon the tax-
payer’s attainment of the plan’s retirement 
age, or in the case of a benefit that is less 
than $7,000, the plan may automatically 
pay the benefit directly to the taxpayer or 
in a rollover to a traditional IRA or, for 
designated Roth amounts, a Roth IRA it 
establishes for the taxpayer. 
‘‘(ix) Eligible amounts may be rolled 
over to a new plan or to an IRA when a 
taxpayer changes jobs, and the adminis-
trator of the new plan can confirm how to 
accomplish such a rollover. 
‘‘(x) The taxpayer may choose to leave 
eligible amounts in their original plan. 
‘‘(xi) The taxpayer may rollover an el-
igible distribution to a traditional IRA, in-
dividual retirement annuity, or a Roth IRA 
for designated Roth contributions. 
‘‘(xii) Direct rollovers are not subject 
to the mandatory 20 percent withholding, 
and the distribution may be in the form of 
a check payable to the new plan or ar-
rangement or by electronic transfer. 
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‘‘(xiii) If the taxpayer receives a pay-
ment directly, the taxpayer has up to 60 
days from the date of distribution to roll-
over an amount equal to the eligible 
amount received plus the dollar amount 
that was withheld and sent to the Internal 
Revenue Service. 
‘‘(xiv) The taxpayer may obtain addi-
tional information from the Internal Rev-
enue Service. 
‘‘(B) REGULATIONS AND GUIDANCE.—The 
Secretary may promulgate such regulations and 
guidance as are necessary to administer this 
section, including regulations updating the list 
in subparagraph (A) as necessary.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2025. 
Æ 
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