Retirement Tax Credit Parity for Cooperatives and Charities Act
Bill: H.R.6738 | Sponsor: Rep. Kind, Ron (D-WI)
Policy area: Taxation

Summary:
Retirement Tax Credit Parity for Cooperatives and Charities Act
This bill allows an individual taxpayer who is eligible to participate in in a CSEC defined contribution pension plan a new tax credit for 10% of employer retirement savings contributions not exceeding $1,000 in a taxable year.

To amend the Internal Revenue Code of 1986 to provide a CSEC employee 
                              tax credit.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Retirement Tax Credit Parity for 
Cooperatives and Charities Act''.

SEC. 2. CSEC EMPLOYEE TAX CREDIT.

    (a) In General.--Subpart A of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 is amended by inserting after 
section 25D the following new section:

``SEC. 25E. CSEC EMPLOYEE TAX CREDIT.

    ``(a) Allowance of Credit.--In the case of an eligible individual, 
there shall be allowed as a credit against the tax imposed by this 
subtitle for the taxable year an amount equal to 10 percent of so much 
of the employer retirement savings contributions made on behalf of the 
eligible individual for the plan year ending with or within such 
taxable year as do not exceed $1,000.
    ``(b) Eligible Individual.--For purposes of this section, the term 
`eligible individual' means any individual who is eligible to 
participate in a CSEC defined contribution plan.
    ``(c) Employer Retirement Savings Contributions.--For purposes of 
this section, with respect to any employee, the term `employer 
retirement savings contributions' means the amount of employer 
contributions (other than elective deferrals as defined in section 
402(g)(3)) made to a CSEC defined contribution plan on behalf of such 
employee.
    ``(d) CSEC Defined Contribution Plan.--For purposes of this 
section, the term `CSEC defined contribution plan' means a defined 
contribution plan which--
            ``(1) as of July 26, 2005, would be an eligible cooperative 
        plan, as defined in section 104(c) of the Pension Protection 
        Act of 2006, if such section applied to defined contribution 
        plans,
            ``(2) as of January 1, 2021, was maintained by an employer 
        that also participated in an eligible cooperative plan, as 
        defined in section 104(c) of the Pension Protection Act of 
        2006,
            ``(3) would be described in subparagraph (B), (C), or (D) 
        of section 414(y)(1) but for the fact that it is a defined 
        contribution plan, or
            ``(4) as of January 1, 2021, was maintained by an employer 
        that also participated in a plan described in subparagraph (B), 
        (C), or (D) of section 414(y)(1).
    ``(e) Inflation Adjustment.--In the case of any taxable year 
beginning after December 31, 2022, the $1,000 amount in subsection (a) 
shall be increased by an amount equal to--
            ``(1) such dollar amount, multiplied by
            ``(2) the cost-of-living adjustment determined under 
        section 1(f)(3) for the calendar year in which the taxable year 
        begins, determined by substituting `calendar year 2021' for 
        `calendar year 2016' in subparagraph (A)(ii) thereof.
Any increase determined under the preceding sentence shall be rounded 
to the nearest multiple of $50.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after December 31, 2021.
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