ployer which is described in subsection (e)(1)(A) shall not 
be treated as failing to meet the requirements of this sub-
section solely because the plan, or another plan main-
tained by the employer which meets the requirements of 
section 401(a), provides for matching contributions on ac-
count of qualified student loan payments as described in 
section 401(m)(13).’’. 
(g) REGULATORY AUTHORITY.—The Secretary shall 
prescribe regulations for purposes of implementing the 
amendments made by this section, including regulations— 
(1) permitting a plan to make matching con-
tributions for qualified student loan payments, as 
defined in sections 401(m)(4)(D) and 408(p)(2)(F) 
of the Internal Revenue Code of 1986, as added by 
this section, at a different frequency than matching 
contributions are otherwise made under the plan, 
provided that the frequency is not less than annu-
ally; 
(2) permitting employers to establish reasonable 
procedures to claim matching contributions for such 
qualified student loan payments under the plan, in-
cluding an annual deadline (not earlier than 3 
months after the close of each plan year) by which 
a claim must be made; and 
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(3) promulgating model amendments which 
plans may adopt to implement matching contribu-
tions on such qualified student loan payments for 
purposes of sections 401(m), 408(p), 403(b), and 
457(b) of the Internal Revenue Code of 1986. 
(h) EFFECTIVE DATE.—The amendments made by 
this section shall apply to contributions made for years 
beginning after December 31, 2020. 
SEC. 111. APPLICATION OF CREDIT FOR SMALL EMPLOYER 
PENSION PLAN STARTUP COSTS TO EMPLOY-
ERS WHICH JOIN AN EXISTING PLAN. 
(a) IN GENERAL.—Section 45E(d)(3)(A) of the In-
ternal Revenue Code of 1986 is amended by striking ‘‘ef-
fective’’ and inserting ‘‘effective with respect to the eligible 
employer’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to eligible employer plans which 
become effective with respect to the eligible employer after 
the date of the enactment of this Act. 
SEC. 112. MILITARY SPOUSE RETIREMENT PLAN ELIGI-
BILITY CREDIT FOR SMALL EMPLOYERS. 
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
1986 is amended by adding at the end the following new 
section: 
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‘‘SEC. 45U. MILITARY SPOUSE RETIREMENT PLAN ELIGI-
BILITY CREDIT FOR SMALL EMPLOYERS. 
‘‘(a) IN GENERAL.—For purposes of section 38, in 
the case of any eligible small employer, the military spouse 
retirement plan eligibility credit determined under this 
section for any taxable year is an amount equal to the 
sum of— 
‘‘(1) $250 with respect to each military spouse 
who is an employee of such employer and who is eli-
gible to participate in an eligible defined contribu-
tion plan of such employer at any time during such 
taxable year, plus 
‘‘(2) so much of the contributions made by such 
employer to all such plans with respect to such em-
ployee during such taxable year as do not exceed 
$250. 
‘‘(b) LIMITATION.—An individual shall only be taken 
into account as a military spouse under subsection (a) for 
the taxable year which includes the date on which such 
individual began participating in the eligible defined con-
tribution plan of the employer and the 2 succeeding tax-
able years. 
‘‘(c) ELIGIBLE SMALL EMPLOYER.—For purposes of 
this section— 
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‘‘(1) IN
GENERAL.—The term ‘eligible small 
employer’ means an eligible employer (as defined in 
section 408(p)(2)(C)(i)(I)). 
‘‘(2) APPLICATION OF 2-YEAR GRACE PERIOD.— 
A 
rule 
similar 
to 
the 
rule 
of 
section 
408(p)(2)(C)(i)(II) shall apply for purposes of this 
section. 
‘‘(d) MILITARY SPOUSE.—For purposes of this sec-
tion— 
‘‘(1) IN GENERAL.—The term ‘military spouse’ 
means, with respect to any employer, any individual 
who is married (within the meaning of section 7703 
as of the first date that the employee is employed by 
the employer) to an individual who is a member of 
the uniformed services (as defined section 101(a)(5) 
of title 10, United States Code). For purposes of 
this section, an employer may rely on an employee’s 
certification that such employee’s spouse is a mem-
ber of the uniformed services if such certification 
provides the name, rank, and service branch of such 
spouse. 
‘‘(2) EXCLUSION
OF
HIGHLY
COMPENSATED 
EMPLOYEES.—With respect to any employer, the 
term ‘military spouse’ shall not include any indi-
vidual if such individual is a highly compensated em-
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ployee of such employer (within the meaning of sec-
tion 414(q)). 
‘‘(e) ELIGIBLE DEFINED CONTRIBUTION PLAN.— 
For purposes of this section, the term ‘eligible defined con-
tribution plan’ means, with respect to any eligible small 
employer, any defined contribution plan (as defined in sec-
tion 414(i)) of such employer if, under the terms of such 
plan— 
‘‘(1) military spouses employed by such em-
ployer are eligible to participate in such plan not 
later than the date which is 2 months after the date 
on which such individual begins employment with 
such employer, and 
‘‘(2) military spouses who are eligible to partici-
pate in such plan— 
‘‘(A) are immediately eligible to receive an 
amount of employer contributions under such 
plan which is not less the amount of such con-
tributions that a similarly situated participant 
who is not a military spouse would be eligible 
to receive under such plan after 2 years of serv-
ice, and 
‘‘(B) immediately have a nonforfeitable 
right to the employee’s accrued benefit derived 
from employer contributions under such plan. 
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‘‘(f) AGGREGATION RULE.—All persons treated as a 
single employer under subsection (b), (c), (m), or (o) of 
section 414 shall be treated as one employer for purposes 
of this section.’’. 
(b) CREDIT ALLOWED AS PART OF GENERAL BUSI-
NESS CREDIT.—Section 38(b) of such Code is amended 
by striking ‘‘plus’’ at the end of paragraph (32), by strik-
ing the period at the end of paragraph (33) and inserting 
‘‘, plus’’, and by adding at the end the following new para-
graph: 
‘‘(34) in the case of an eligible small employer 
(as defined in section 45U(c)), the military spouse 
retirement plan eligibility credit determined under 
section 45U(a).’’. 
(c) CLERICAL AMENDMENT.—The table of sections 
for subpart D of part IV of subchapter A of chapter 1 
of such Code is amended by adding at the end the fol-
lowing new item: 
‘‘Sec. 45U. Military spouse retirement plan eligibility credit for small employ-
ers.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
the date of the enactment of this Act. 
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