Title: Saving for the Future Act
Policy area: Labor and Employment

Summary:
Saving for the Future Act
This bill requires employers to make minimum contributions to savings plans for full-time employees and increases certain individual and corporate income tax rates. Specifically, it requires employers of 10 or more full-time employees to contribute 50 cents for each hour an employee works to a qualified pension plan. The minimum contribution increases to 60 cents per hour after two years and proportionally based on income beginning two years thereafter.  The bill further establishes the Federal Universal Personal Savings Investment Board to oversee UP retirement and savings accounts. Applicable small employers may make contributions to such accounts directly as a qualified plan or through a state-run program. UP retirement accounts are portable, defined-contribution pension plans to which employees must contribute 4% of the employee's wages unless the employee opts out. Employers must make the minimum required contribution under this program as well as match employee contributions up to 10% of an employee's wages. The initial $2,500 of such employer contributions may be applied to an UP savings account and used for certain nonroutine expenses such as a large medical bill or home mortgage down payment.  Employer contributions to UP accounts are generally deferred from income tax and employee contributions may be pretax or posttax. Employers also receive a tax credit for a specified proportion of the minimum contribution amount for up to the employer's first 30 employees.  Additionally, the bill also increases the highest individual income tax rate from 37% to 39.6% and the highest corporate income tax rate from 21% to 23%.


[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 1053 Introduced in Senate (IS)]

<DOC>






116th CONGRESS
  1st Session
                                S. 1053

   To establish a universal personal savings program, and for other 
                               purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             April 4, 2019

  Mr. Coons (for himself and Ms. Klobuchar) introduced the following 
  bill; which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
   To establish a universal personal savings program, and for other 
                               purposes.

    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 ``Saving for the Future Act''.

SEC. 2. FINDINGS.

    Congress finds as follows:
            (1) Three out of 10 private-sector workers lack access to 
        any workplace retirement plan, according to a Bureau of Labor 
        Statistics report in March 2018.
            (2) A retirement study conducted by the Government 
        Accountability Office found that 52 percent of households age 
        55-and-older have no retirement savings in a defined 
        contribution plan or individual retirement account, and nearly 
        30 percent of households age 55-and-older have no retirement 
        savings and no defined benefit plan.
            (3) A 2015 report on the economic well-being of United 
        States households conducted by the Federal Reserve found that 
        31 percent of non-retirees reportedly ``have no retirement 
        savings or pension whatsoever'', and that nearly one-half of 
        non-retirees with self-directed retirement accounts are either 
        ``not confident'' or ``slightly confident'' in their ability to 
        make the right investment decisions when investing in such 
        accounts.

SEC. 3. UNIVERSAL PERSONAL SAVINGS.

    (a) In General.--Subtitle B of title I of the Employee Retirement 
Income Security Act of 1974 (29 U.S.C. 1021 et seq.) is amended by 
adding at the end the following:

                  ``PART 8--UNIVERSAL PERSONAL SAVINGS

``SEC. 801. DEFINITIONS.

    ``For purposes of this part:
            ``(1) Applicable employer.--The term `applicable employer' 
        means an employer--
                    ``(A) with at least 10 full-time equivalent 
                employees; and
                    ``(B) that has employed at least 10 full-time 
                equivalent employees for not less than 2 years.
            ``(2) Board.--The term `Board' means the Federal Universal 
        Personal Savings Investment Board established under section 
        803.
            ``(3) Employee.--The term `employee', unless specified 
        otherwise, includes full-time and part-time employees of an 
        applicable employer.
            ``(4) Executive director.--The term `Executive Director' 
        means the Executive Director of the UP Account Board appointed 
        under section 803.
            ``(5) Full time.--The term `full time', with respect to 
        employment, means 40 hours per week.
            ``(6) Full-time equivalent employee.--The term `full-time 
        equivalent employee' means the sum of--
                    ``(A) the number of employees working full time; 
                and
                    ``(B) the full-time equivalent of the number of 
                employees working part-time, as defined and calculated 
                in the manner determined most appropriate by the 
                Secretary.

``SEC. 802. EMPLOYER CONTRIBUTION REQUIREMENTS.

    ``(a) Minimum Employer Contribution.--
            ``(1) In general.--Beginning in the first full taxable year 
        following the date of enactment of the Saving for the Future 
        Act, each applicable employer shall contribute to a qualifying 
        plan, on behalf of each employee that is not enrolled in an 
        active, defined benefit pension plan sponsored by such 
        employer, the applicable minimum amount described in paragraph 
        (2).
            ``(2) Minimum employer contribution.--
                    ``(A) Initial amounts.--For the first year in which 
                the requirements of paragraph (1) apply, and the 1 year 
                immediately following such first year, the minimum 
                amount an applicable employer is required to contribute 
                for each full-time employee is $0.50 per hour worked by 
                the employee.
                    ``(B) Third and fourth years.--For the 2 years 
                immediately following the period during which 
                subparagraph (A) applies, the minimum amount an 
                applicable employer is required to contribute for each 
                full-time employee is $.60 per hour worked by the 
                employee.
                    ``(C) Subsequent years.--The Secretary shall 
                increase the amounts described in subparagraph (B) for 
                the year immediately following the period during which 
                subparagraph (B) applies, and every 3 years thereafter, 
                by an amount proportional to growth in average base 
                supervisory wages.
            ``(3) Noncompliance.--In the case of an applicable employer 
        that is found to be in violation of the requirement under 
        paragraph (1), such employer shall be required to make the 
        contributions required under paragraph (1), plus interest, at 
        an interest rate set by the Secretary through rulemaking.
    ``(b) Qualifying Plans.--
            ``(1) In general.--Each applicable employer shall provide a 
        pension plan for all employees.
            ``(2) Types of plans.--The pension plan required under 
        paragraph (1)--
                    ``(A)(i) in the case of an applicable employer with 
                100 or more full-time equivalent employees, shall be an 
                employer plan, which may be a plan described in section 
                401(k) of the Internal Revenue Code of 1986, defined 
                benefit pension plan, or any other plan described in 
                section 219(g)(5) of the Internal Revenue Code of 1986; 
                and
                    ``(ii) in the case of an applicable employer with 
                fewer than 100 full-time equivalent employees, shall be 
                a plan described in subparagraph (A), a simple 
                retirement account under section 408(p) of the Internal 
                Revenue Code of 1986 or an automatic payroll deduction 
                individual retirement account or multiple employer 
                plan, including any current or prospective State-
                established and -facilitated payroll deduction or 
                automatic individual retirement account, or an UP 
                Account described in section 804; or
                    ``(B) in the case of an applicable employer who 
                does not provide an employer contribution but offers a 
                State-established or -facilitated program described in 
                subparagraph (A)(ii), such employer shall provide an UP 
                Retirement Account to which the employer makes 
                contributions, and any employee contributions shall be 
                directed to the State plan.
            ``(3) Clarification of employer obligations with respect to 
        certain employees.--In the case of an applicable employer that 
        offers an UP Retirement Account plan and any other type of plan 
        described in subparagraph (A)(i), (A)(ii), or (B), as 
        applicable, of paragraph (2), to employees, with respect to 
        employees for whom the employer is not required under this Act 
        to offer participation in such other type of plan, the 
        requirements of this part may be met by allowing such employees 
        to participate in such other plan.
    ``(c) Standard Notice.--The board shall develop a standard notice 
that employers with fewer than 10 workers electing not to make 
contributions are required to provide to each employee upon hire, and 
annually thereafter. Such notice shall provide instructions on how to 
set up an account, make contributions, and claim the individual credit 
under section 25BB of the Internal Revenue Code of 1986.

``SEC. 803. UP ACCOUNT BOARD.

    ``(a) Establishment of Board.--There is established a Federal 
Universal Personal Savings Investment Board, an independent government 
agency for the purpose of overseeing UP Accounts.
    ``(b) Membership.--
            ``(1) Appointment of members.--The President shall appoint, 
        by and with the consent of the Senate, 5 members to serve on 
        the Board. Such members shall have substantial experience, 
        training, and expertise in the management of financial 
        investments and pension benefit plans.
            ``(2) Executive director.--The Board shall hire an 
        Executive Director of the Board.
            ``(3) Terms.--Each member shall serve a term of 5 years, 
        except that, of the members first appointed, 1 shall serve a 
        term of 1 year, one shall serve a term of 2 years, one shall 
        serve a term of 3 years, one shall serve a term of 4 years, and 
        one shall serve a term of 5 years. Each member of the Board may 
        serve up to 2 consecutive terms.
    ``(c) Funding.--Administrative expenses incurred to carry out this 
part shall be paid first out net earnings in the UP Account Fund.

``SEC. 804. UP ACCOUNT FUND.

    ``(a) In General.--There is established in the Treasury of the 
United States an UP Account Fund.
    ``(b) Funds.--The UP Account Fund shall consist of all amounts 
contributed by participants, and employees on behalf of participants, 
into UP Retirement Accounts and UP Savings Accounts, increased by the 
total net earnings from investments of sums in the UP Account Fund or 
reduced by the total net losses from investments of the UP Account 
Fund, and reduced by the total amount of payments made from the UP 
Account Fund (including payments for administrative expenses).
    ``(c) Permissible Uses of Funds.--The sums in the UP Account Fund 
are appropriated and shall remain available without fiscal year 
limitation--
            ``(1) to invest in accordance with section 805(h);
            ``(2) to pay benefits or purchase annuity contracts under 
        this subchapter; and
            ``(3) to pay administrative expenses.

``SEC. 805. UP RETIREMENT ACCOUNTS.

    ``(a) In General.--The Board shall establish UP Retirement Accounts 
that are portable, defined contribution pension plans.
    ``(b) Rollovers.--
            ``(1) Definitions.--For purposes of this subsection--
                    ``(A) the term `eligible rollover distribution' has 
                the meaning given such term by section 402(c)(4) of the 
                Internal Revenue Code of 1986; and
                    ``(B) the term `qualified trust' has the meaning 
                given such term by section 402(c)(8) of the Internal 
                Revenue Code of 1986.
            ``(2) Rollovers.--A participant may contribute to the UP 
        Retirement Account an eligible rollover that a qualified trust 
        could accept under the Internal Revenue Code of 1986. A 
        contribution made under this subsection shall be made in the 
        form described in section 401(a)(31) of the Internal Revenue 
        Code of 1986. In the case of an eligible rollover distribution, 
        the maximum amount transferred to the Up Account Fund shall not 
        exceed the amount which would otherwise have been included in 
        the participant's gross income for Federal income tax purposes.
            ``(3) Regulations.--The Executive Director shall prescribe 
        regulations to carry out this subsection.
    ``(c) Administration.--The Board shall contract with one or more 
private investment firms to administer the UP Accounts. The Board shall 
contract with multiple private investment firms, as necessary to ensure 
that no single firm administers more than $500,000,000,000 in UP 
Account assets.
    ``(d) Individual Eligibility.--
            ``(1) In general.--An employee is eligible to participate 
        in an UP Retirement Account if--
                    ``(A) the employee's employer establishes an UP 
                Retirement Account on the employee's behalf; or
                    ``(B) the employee demonstrates to the Board that 
                the employee works for a employer that is not an 
                applicable employer.
            ``(2) Maintenance of account.--An individual who becomes a 
        participant in an UP Retirement Account as described in 
        paragraph (1) may maintain such account and may continue to 
        make individual contributions to such account, regardless of 
        such individual's subsequent employment status, provided that 
        the individual is not a participant in another plan described 
        in section 802(b)(2).
    ``(e) Quarterly Statements.--The Board shall provide participants 
with a quarterly statement explaining each participant's projected 
income in retirement under different distribution scenarios and 
identifying the total dollar amount paid in fees for the year.
    ``(f) Employee and Employer Contributions.--
            ``(1) Employee contributions.--
                    ``(A) In general.--Applicable employers making 
                contributions required under section 802 to an UP 
                Retirement Account shall auto-enroll all employees in 
                such an account with an employee contribution that is 
                equal to 4 percent of the employee's wages, with the 
                option for any such employee to elect a different 
                employee contribution level or to opt out of such 
                account at any time.
                    ``(B) Auto-escalation.--Employees making 
                contributions to an UP Retirement Account shall have 
                their contributions automatically escalated by half a 
                percentage point at the conclusion of each full year 
                during which such employer is so enrolled, until 
                reaching the level of a 10 percent employee 
                contribution. Any employee may opt out of such 
                automatic escalation.
                    ``(C) Default elections in the case of changes in 
                employment.--In the case of an employee who was 
                enrolled in an UP Retirement Account through one 
                employer and subsequently ceases to work for such 
                employer, if the employee subsequently is employed by 
                another applicable employer, the employee's default 
                contribution level under this paragraph shall be the 
                same level that it was on the last day of employment 
                with the previous employer.
            ``(2) Employer contributions.--
                    ``(A) In general.--Applicable employers may 
                contribute more to an employee's UP Retirement Account 
                than is required under section 802, but may not 
                contribute more than \1/2\ the amount in effect under 
                section 402(g)(1)(B) of the Internal Revenue Code of 
                1986 for the taxable year.
                    ``(B) Default rules.--Any employer matching 
                requirements under this part shall apply to any 
                employer contributions that are in addition to the 
                minimum employer contribution.
                    ``(C) Fiduciary duties.--An applicable employer's 
                fiduciary duties with respect to an employee's UP 
                Retirement Account extend only to the full and timely 
                payment of contributions to their employees' UP 
                Retirement Accounts. For all other purposes, the 
                members of the Board are the fiduciaries of such 
                accounts.
    ``(g) Participant Accounts.--
            ``(1) In general.--The Executive Director shall establish 
        and maintain an account for each individual who makes 
        contributions or for whom contributions are made under this 
        section.
            ``(2) Balances.--The balance in a participant's account at 
        any time is the excess of--
                    ``(A) the sum of--
                            ``(i) all contributions made to the UP 
                        Retirement Account by the participant;
                            ``(ii) all contributions made to such 
                        Account for the benefit of the participant; and
                            ``(iii) the total amount of the allocations 
                        made to and reductions made in the account 
                        pursuant to paragraph (3), over
                    ``(B) the amounts paid out of the UP Retirement 
                Account with respect to such participant.
            ``(3) Adjustments.--Pursuant to regulations prescribed by 
        the Executive Director, the Executive Director shall allocate 
        to each account an amount equal to a pro rata share of the net 
        earnings and net losses from each investment of sums in the UP 
        Account Fund attributable to sums credited to such account, 
        reduced by an appropriate share of the administrative expenses 
        paid out of the net earnings, as determined by the Executive 
        Director.
    ``(h) Investments.--The following investment rules shall apply with 
respect to an UP Retirement Account:
            ``(1) The Board shall make available a reasonable menu of 
        investment products, including low-fee index funds, sufficient 
        to provide participants with the opportunity to diversify their 
        UP Retirement Accounts in order to minimize the risk of large 
        losses.
            ``(2) The default investment option for participants shall 
        minimize fees, be diversified, and automatically reduce risk to 
        the participant as the participant approaches retirement age.
            ``(3) UP Retirement Accounts shall allow participants to 
        change or customize investment allocation.
            ``(4) The board shall select investments solely in the 
        interests of participants and beneficiaries and for the 
        exclusive purpose of providing benefits and deferring 
        reasonable expenses with the prevailing care, skill, prudence, 
        and diligence that a prudent individual acting in a like 
        capacity and familiar with such matters would use.
    ``(i) Distributions.--
            ``(1) In general.--The Board shall ensure that investors 
        are offered forms of distribution that include--
                    ``(A) monthly income for life for the participant 
                or surviving spouse, if applicable;
                    ``(B) monthly income until the normal or maximum 
                Social Security retirement age for the participant or 
                surviving spouse, if applicable; and
                    ``(C) automatic, regular withdrawals, under which a 
                set percentage of initial capital is withdrawn each 
                year, on a monthly basis.
            ``(2) Death of participant.--In case of death of a 
        participant, a lump sum shall be paid to designated 
        beneficiary.

``SEC. 806. UP SAVINGS ACCOUNTS.

    ``(a) In General.--In addition to a standard UP Retirement Account 
under section 805, a participant may maintain an UP Savings Account, 
established by the Board, and designed as safe, short- to medium-term 
savings vehicles.
    ``(b) Contributions; Maximum Balance.--
            ``(1) In general.--Participants may make contributions to 
        their UP Savings Account until the account reaches the maximum 
        balance amount described in paragraph (1). Any contributions a 
        participant wishes to make after the participant's account 
        reaches such maximum balance amount shall be credited to the 
        participant's UP Retirement Account established under section 
        805. An UP Savings Account may grow past the maximum balance 
        amount due to accumulation without penalty.
            ``(2) Increased amounts.--The Board shall establish the 
        maximum balance amount for purposes of paragraph (1) as 
        follows:
                    ``(A) For the first fiscal year that begins after 
                the date of enactment of the Saving for the Future Act, 
                the maximum balance amount shall be 2,500.
                    ``(B) For fiscal year immediately following the 
                fiscal year described in subparagraph (A), and each 
                fiscal year thereafter, the Board shall increase the 
                maximum balance amount from the previous year, in 
                increments of $100 that most closely reflects the 
                average wage growth during the applicable 12-month 
                period.
            ``(3) Default rule.--Any contributions a participant makes 
        pursuant to accounts established under this part shall be 
        credited to the participant's UP Savings Account, until such 
        has reached the maximum balance amount, unless the participant 
        specifies otherwise. Once the maximum balance is reached, 
        additional contributions will go to a participant's UP 
        Retirement Account.
    ``(c) Investment.--The Board may invest contributions to UP Savings 
Account only in cash, money market funds, certificates of deposit, or 
government bonds.
    ``(d) Withdrawals.--Participants may withdraw amounts from their UP 
Savings Account when experiencing a specific financial situation that 
requires a non-routine use of money, as determined by the Board (in 
rules similar to the rules governing hardship distributions from a 
trust described in section 401(a) of the Internal Revenue Code of 1986 
which is exempt from taxation under section 501(a) of such Code). Such 
situations may include a major reduction in earnings, an on-the-job 
injury, disability, family or medical leave, a large medical bill, the 
down payment for a home, and the beginning of a training or educational 
experience. The Board shall determine the rules regarding such 
withdrawals, including allowable needs, and demonstration of the need, 
but shall not impose a withdrawal penalty or impose a repayment 
requirement. Loans to investors shall not be permitted.
    ``(e) Other Pension Plans.--Any pension plan may offer a safe, 
short- to medium-term savings account with terms similar to the terms 
that apply to UP Savings Accounts described in this section. For 
purposes of this Act, any such account shall be considered part of the 
pension plan.

``SEC. 807. TAX TREATMENT OF UP ACCOUNTS.

    ``(a) In General.--For purposes of the Internal Revenue Code of 
1986--
            ``(1) the UP Account Fund shall be treated as a trust 
        described in section 401(a) of such Code which is exempt from 
        taxation under section 501(a) of such Code;
            ``(2) any contribution to, or distribution from, the UP 
        Account Fund shall be treated in the same manner as 
        contributions to or distributions from such a trust; and
            ``(3) subject to section 401(k)(4)(B) of such Code and any 
        dollar limitation on the application of section 402(a)(8) of 
        such Code, contributions to the UP Account Fund shall not be 
        treated as distributed or made available to an employee or 
        Member nor as a contribution made to the Fund by an employee or 
        Member merely because the employee or Member has, under the 
        provisions of this part, an election whether the contribution 
        will be made to the UP Account Fund or received by the employee 
        or Member in cash.
    ``(b) Nondiscrimination Requirements.--Notwithstanding any other 
provision of law, the UP Account Fund is not subject to the 
nondiscrimination requirements applicable to arrangements described in 
section 401(k) of the Internal Revenue Code of 1986, or to matching 
contributions (as described in section 401(m) of such Code), so long as 
it meets the requirements of this section.
    ``(c) Rule of Construction.--Subsection (a) shall not be construed 
to provide that any amount of the employee's or Member's basic pay 
which is contributed to the UP Account Fund shall not be included in 
the term `wages' for the purposes of section 209 of the Social Security 
Act or section 3121(a) of the Internal Revenue Code of 1986.

``SEC. 808. QUALIFIED ROTH CONTRIBUTION PROGRAM.

    ``(a) Definitions.--For purposes of this section--
            ``(1) the term `qualified Roth contribution program' means 
        a program described in paragraph (1) of section 402A(b) of the 
        Internal Revenue Code of 1986 which meets the requirements of 
        paragraph (2) of such section; and
            ``(2) the terms `designated Roth contribution' and 
        `elective deferral' have the meanings given such terms in 
        section 402A of the Internal Revenue Code of 1986.
    ``(b) Authority To Establish.--The Executive Director shall by 
regulation provide for the inclusion in the UP Accounts of a qualified 
Roth contribution program, under such terms and conditions as the Board 
may prescribe.
    ``(c) Required Provisions.--The regulations under subsection (b) 
shall include--
            ``(1) provisions under which an election to make designated 
        Roth contributions may be made by any individual who is 
        eligible to make contributions to an UP Account under section 
        805(d); and
            ``(2) any other provisions which may be necessary to carry 
        out this section.

``SEC. 809. SURVIVOR ANNUITIES.

    ``The rules on survivor annuities under subchapter IV of chapter 84 
of title 5, United States Code, that are applicable to the Thrift 
Savings Plan, shall apply to UP Accounts. The Executive Director shall 
promulgate regulations to provide for the application of such rules to 
UP Accounts, as appropriate.''.
    (b) Clerical Amendment.--The table of contents in section 1 of the 
Employee Retirement Income Security Act of 1974 is amended by inserting 
after the item relating to section 734 the following new items:

                  ``PART 8--Universal Personal Savings

``Sec. 801. Definitions.
``Sec. 802. Employer contribution requirements.
``Sec. 803. UP Account Board.
``Sec. 804. UP Account Fund.
``Sec. 805. UP Retirement Accounts.
``Sec. 806. UP Savings Accounts.
``Sec. 807. Tax treatment of UP Accounts.
``Sec. 808. Qualified Roth contribution program.
``Sec. 809. Survivor annuities.''.

SEC. 4. INCREASE IN CREDIT FOR SMALL EMPLOYER PENSION PLAN STARTUP 
              COSTS.

    (a) In General.--Paragraph (1) of section 45E(b) of the Internal 
Revenue Code of 1986 is amended by striking ``$500'' and inserting 
``$2,000''.
    (b) Eligible Employers.--Paragraph (1) of section 45E(c) of the 
Internal Revenue Code of 1986 is amended by inserting ``, applied by 
substituting `250' for `100''' after ``408(p)(2)(C)(i)''.
    (c) Penalty for Noncompliant Employers.--Subsection (c) of section 
45E of the Internal Revenue Code of 1986 is amended by adding at the 
end the following new paragraph:
            ``(3) Employers failing to make required contributions.--
        Such term shall not include an employer subject to the 
        requirement of section 802(a)(1) of the Employee Retirement 
        Income Security Act of 1974 that fails, within the time 
        prescribed by the Secretary, to make any required contribution 
        under such section 802 for the taxable year or any of the 4 
        taxable years preceding such year.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 5. CREDIT FOR MINIMUM EMPLOYER CONTRIBUTIONS.

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

``SEC. 45T. CREDIT FOR MINIMUM EMPLOYER CONTRIBUTIONS.

    ``(a) General Rule.--For purposes of section 38, the minimum 
employer contribution credit determined under this section for any 
taxable year is an amount equal to the applicable percentage of the 
qualified retirement contributions paid or incurred by the taxpayer 
during the taxable year.
    ``(b) Applicable Percentage.--For purposes of subsection (a), the 
applicable percentage is--
            ``(1) 50 percent, in the case of contributions made with 
        respect to not more than 15 employees of the employer (or the 
        number of employees of the employer which is the equivalent of 
        15 full-time employees), and
            ``(2) 25 percent, in the case of contributions made with 
        respect to so many of the employees of the employer (or the 
        equivalent of so many full-time employees) as exceeds 15 but 
        does not exceed 30.
    ``(c) Qualified Retirement Contributions.--For purposes of this 
section--
            ``(1) In general.--The term `qualified retirement 
        contributions' means--
                    ``(A) contributions made by an employer as required 
                under section 802 of the Employee Retirement Income 
                Security Act of 1974, and
                    ``(B) contributions to a plan described in section 
                802(b)(2) of such Act made by an employer which is not 
                subject to the requirement of section 802(a)(1) of such 
                Act.
            ``(2) Only required contribution amount taken into 
        account.--The term `qualified retirement contributions' does 
        not include any amount in excess of--
                    ``(A) the amount determined under section 802(a)(2) 
                of the Employee Retirement Income Security Act with 
                respect to each employee of the employer, or
                    ``(B) the amount which would be so determined if 
                the employer were subject to the requirement of section 
                802(a)(1) of such Act.
    ``(d) Employers Excluded for Failure To Make Contributions.--
Subsection (a) shall not apply to any employer which fails, within the 
time prescribed by the Secretary, to make any contribution required to 
be made by such employer under section 802 of the Employee Retirement 
Income Security Act of 1974 for the taxable year or any of the 4 
taxable years preceding such year.
    ``(e) Special Rules.--For purposes of this section--
            ``(1) Aggregation rules, etc.--Rules similar to the rules 
        of section 45E(e) shall apply.
            ``(2) Denial of double benefit.--No credit shall be allowed 
        under this section for any taxable year in which the credit 
        under section 45E is allowed with respect to the taxpayer.
    ``(f) Credit Made Available to Tax-Exempt Eligible Employers.--
            ``(1) In general.--In the case of a tax-exempt eligible 
        employer, there shall be treated as a credit allowable under 
        subpart C (and not allowable under this subpart) the lesser 
        of--
                    ``(A) the amount of the credit determined under 
                this section with respect to such employer, or
                    ``(B) the amount of the payroll taxes of the 
                employer during the calendar year in which the taxable 
                year begins.
            ``(2) Tax-exempt eligible employer.--For purposes of this 
        section, the term `tax-exempt eligible employer' means an 
        eligible employer which is any organization described in 
        section 501(c) which is exempt from taxation under section 
        501(a).
            ``(3) Payroll taxes.--For purposes of this subsection--
                    ``(A) In general.--The term `payroll taxes' means--
                            ``(i) amounts required to be withheld from 
                        the employees of the tax-exempt eligible 
                        employer under section 3401(a),
                            ``(ii) amounts required to be withheld from 
                        such employees under section 3101(b), and
                            ``(iii) amounts of the taxes imposed on the 
                        tax-exempt eligible employer under section 
                        3111(b).
                    ``(B) Special rule.--A rule similar to the rule of 
                section 24(d)(2)(C) shall apply for purposes of 
                subparagraph (A).''.
    (b) Credit To Be Made Part of Business Credit.--Subsection (b) of 
section 38 of the Internal Revenue Code of 1986 is amended by striking 
``plus'' at the end of paragraph (31), by striking the period at the 
end of paragraph (32) and inserting ``, plus'', and by adding at the 
end the following new paragraph:
            ``(33) in the case of an eligible employer, the minimum 
        employer contribution credit determined under section 
        45T(a).''.
    (c) Clerical Amendment.--The table of sections for subpart D of 
part IV of subchapter A of chapter 1 of the Internal Revenue Code of 
1986 is amended by inserting after the item relating to section 45S the 
following new item:

``Sec. 45T. Credit for minimum employer contributions.''.
    (d) Transfers to Federal Old-Age and Survivors Insurance Trust 
Fund.--There are hereby appropriated to the Federal Old-Age and 
Survivors Trust Fund and the Federal Disability Insurance Trust Fund 
established under section 201 of the Social Security Act (42 U.S.C. 
401) amounts equal to the reduction in revenues to the Treasury by 
reason of the enactment of section 45T(f) of the Internal Revenue Code 
of 1986. Amounts appropriated by the preceding sentence shall be 
transferred from the general fund at such times and in such manner as 
to replicate to the extent possible the transfers which would have 
occurred to such Trust Fund had such amendments not been enacted.
    (e) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 6. ADDITIONAL CREDIT FOR INDIVIDUALS MAKING RETIREMENT 
              CONTRIBUTIONS.

    (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 25B the following new section:

``SEC. 25BB. ADDITIONAL CREDIT FOR CERTAIN INDIVIDUALS MAKING 
              RETIREMENT CONTRIBUTIONS.

    ``(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 50 percent of so much 
of the qualified retirement contributions of the individual for the 
taxable year as do not exceed the base amount.
    ``(b) Eligible Individual.--For purposes of this section, the term 
`eligible individual' means an individual whose employer does not 
provide a defined benefit plan (as defined in section 414(j)), defined 
contribution plan (as defined in section 414(i)), or participation in 
an UP Account under section 805 of the Employee Retirement Income 
Security Act of 1974, or who is not employed, at the time the qualified 
retirement contributions are made.
    ``(c) Qualified Retirement Contributions, Etc.--For purposes of 
this section--
            ``(1) In general.--The term `qualified retirement 
        contributions' means, with respect to any taxable year, any 
        amounts paid in cash by an individual to--
                    ``(A) an individual retirement plan, or
                    ``(B) an UP Account established under section 805 
                of the Employee Retirement Income Security Act of 1974,
        for the benefit of the individual.
            ``(2) Base amount.--The base amount for any taxable year is 
        an amount equal to the amount in effect under section 
        802(a)(3)(i) of the Employee Retirement Income Security Act of 
        1974 for such year.
    ``(d) Special Rules.--
            ``(1) Investment in the contract.--Rules similar to the 
        rules of section 25B(f) shall apply for purposes of this 
        section.
            ``(2) Coordination with saver's credit.--The credit under 
        this section and the credit under section 25B shall each be 
        determined without regard to the other.''.
    (b) Clerical Amendment.--The table of sections for subpart A of 
part IV of subchapter A of chapter 1 of the Internal Revenue Code of 
1986 is amended by inserting after the item relating to section 25B the 
following new item:

``Sec. 25BB. Additional credit for certain individuals making 
                            retirement contributions.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 7. INCREASE IN HIGHEST INDIVIDUAL INCOME TAX RATE.

    (a) In General.--Each of the tables contained in subparagraphs (A), 
(B), (C), (D), and (E) of section 1(j)(2) of the Internal Revenue Code 
of 1986 is amended by striking ``37%'' in the last line and inserting 
``39.6%''.
    (b) Conforming Amendment.--Clause (iii) of section 1(j)(4)(B) of 
the Internal Revenue Code of 1986 is amended--
            (1) by striking ``37 percent'' and inserting ``39.6 
        percent'',
            (2) by striking ``37-percent'' in subclause (II) and 
        inserting ``39.6-percent'', and
            (3) by striking ``37-percent'' in the heading and inserting 
        ``39.6-percent''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2019.

SEC. 8. INCREASE IN CORPORATE INCOME TAX RATE.

    (a) In General.--Subsection (b) of section 11 of the Internal 
Revenue Code of 1986 is amended by striking ``21 percent'' and 
inserting ``23 percent''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after December 31, 2019.
                                 <all>