I 
117TH CONGRESS 
1ST SESSION H. R. 2741 
To modify rules relating to 403(b) plans. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 21, 2021 
Mr. PANETTA (for himself, Mr. ESTES, Mr. BRENDAN F. BOYLE of Pennsyl-
vania, Mr. LAHOOD, Ms. DEAN, and Mr. BARR) introduced the following 
bill; which was referred to the Committee on Financial Services, and in 
addition to the Committee on Ways and Means, for a period to be subse-
quently determined by the Speaker, in each case for consideration of such 
provisions as fall within the jurisdiction of the committee concerned 
A BILL 
To modify rules relating to 403(b) plans. 
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 ‘‘Public Service Retire-
ment Fairness Act of 2021’’. 
SEC. 2. ENHANCEMENT OF 403(b) PLANS. 
(a) PERMITTED INVESTMENTS.— 
(1) IN
GENERAL.—Section 403(b)(7)(A)(i) of 
the Internal Revenue Code of 1986 is amended to 
read as follows: 
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‘‘(i) the amounts to be held in that 
custodial account are invested in regulated 
investment company stock or a group trust 
intended to satisfy the requirements of In-
ternal Revenue Service Revenue Ruling 
81–100 (or any successor guidance), and’’. 
(2) 
CONFORMING
AMENDMENT.—Section 
403(b)(7) of such Code is amended by striking ‘‘FOR 
REGULATED INVESTMENT COMPANY STOCK’’. 
(3) EFFECTIVE DATE.—The amendments made 
by this subsection shall apply to amounts invested 
after December 31, 2020. 
(b) AMENDMENTS TO THE INVESTMENT COMPANY 
ACT OF 1940.—Section 3(c)(11) of the Investment Com-
pany Act of 1940 (15 U.S.C. 80a–3(c)(11)) is amended 
to read as follows: 
‘‘(11) Any— 
‘‘(A) employee’s stock bonus, pension, or 
profit-sharing trust which meets the require-
ments for qualification under section 401 of the 
Internal Revenue Code of 1986; 
‘‘(B) custodial account meeting the re-
quirements of section 403(b)(7) of such Code; 
‘‘(C) governmental plan described in sec-
tion 3(a)(2)(C) of the Securities Act of 1933; 
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‘‘(D) collective trust fund maintained by a 
bank consisting solely of assets of one or more 
of such trusts, government plans, or church 
plans, companies or accounts that are excluded 
from the definition of an investment company 
under paragraph (14) of this subsection; 
‘‘(E) plan which meets the requirements of 
section 403(b) of the Internal Revenue Code of 
1986 if— 
‘‘(i) such plan is subject to title I of 
the Employee Retirement Income Security 
Act of 1974 (29 U.S.C. 1001 et seq.); 
‘‘(ii) any employer making such plan 
available agrees to serve as a fiduciary for 
the plan with respect to the selection of the 
plan’s investments among which partici-
pants can choose; or 
‘‘(iii) such plan is a governmental 
plan (as defined in section 414(d) of such 
Code); or 
‘‘(F) separate account the assets of which 
are derived solely from— 
‘‘(i) contributions under pension or 
profit-sharing plans which meet the re-
quirements of section 401 of the Internal 
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Revenue Code of 1986 or the requirements 
for deduction of the employer’s contribu-
tion under section 404(a)(2) of such Code; 
‘‘(ii) 
contributions 
under 
govern-
mental plans in connection with which in-
terests, participations, or securities are ex-
empted from the registration provisions of 
section 5 of the Securities Act of 1933 by 
section 3(a)(2)(C) of such Act; 
‘‘(iii) advances made by an insurance 
company in connection with the operation 
of such separate account; and 
‘‘(iv) contributions to a plan described 
in subparagraph (E).’’. 
(c) AMENDMENTS
TO
THE SECURITIES ACT
OF 
1933.—Section 3(a)(2) of the Securities Act of 1933 (15 
U.S.C. 77c(a)(2)) is amended— 
(1) by striking ‘‘or (D)’’ and inserting ‘‘(D) a 
plan which meets the requirements of section 403(b) 
of such Code if (i) such plan is subject to title I of 
the Employee Retirement Income Security Act of 
1974 (29 U.S.C. 1001 et seq.), (ii) any employer 
making such plan available agrees to serve as a fidu-
ciary for the plan with respect to the selection of the 
plan’s investments among which participants can 
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choose, or (iii) such plan is a governmental plan (as 
defined in section 414(d) of such Code); or (E)’’; 
(2) by striking ‘‘(C), or (D)’’ and inserting 
‘‘(C), (D), or (E)’’; and 
(3) by striking ‘‘(iii) which is a plan funded’’ 
and inserting ‘‘(iii) in the case of a plan not de-
scribed in subparagraph (D), which is a plan fund-
ed’’. 
(d) AMENDMENTS TO THE SECURITIES EXCHANGE 
ACT OF 1934.—Section 3(a)(12)(C) of the Securities Ex-
change Act of 1934 (15 U.S.C. 78c(a)(12)(C)) is amend-
ed— 
(1) by striking ‘‘or (iv)’’ and inserting ‘‘(iv) a 
plan which meets the requirements of section 403(b) 
of such Code if (I) such plan is subject to title I of 
the Employee Retirement Income Security Act of 
1974 (29 U.S.C. 1001 et seq.), (II) any employer 
making such plan available agrees to serve as a fidu-
ciary for the plan with respect to the selection of the 
plan’s investments among which participants can 
choose, or (III) such plan is a governmental plan (as 
defined in section 414(d) of such Code), or (v)’’; 
(2) by striking ‘‘(ii), or (iii)’’ and inserting 
‘‘(ii), (iii), or (iv)’’; and 
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