Title: Retirement Savings Lost and Found Act
Policy area: Labor and Employment

Summary:
Retirement Savings Lost and Found Act
This bill requires the Department of the Treasury and the Social Security Administration (SSA) to create an online Retirement Savings Lost and Found (RSLF) to assist individuals in locating certain employer-sponsored retirement accounts. The RSLF must provide plan participants or beneficiaries only with the ability to view contact information for the administrator of a plan that is sufficient to locate the plan.
The bill sets forth additional reporting and notification requirements for retirement plans.
Treasury and the SSA must take precautions to (1) safeguard the privacy and security of participants' plan information, and (2) permit plan participants to opt out of inclusion in the RSLF.
The bill also revises provisions that permit mandatory distributions of the balances of small retirement accounts using a rollover into an Individual Retirement Account (IRA). The bill modifies the investment options available for the distributions and increases the maximum account balance that may be subject to such a distribution.
A plan must transfer unclaimed mandatory distributions that are $1,000 or less to the RSLF or to an IRA established by Treasury. The RSLF must invest funds received in Treasury securities and distribute the balance upon receiving an application from a plan participant or beneficiary.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7439 Introduced in House (IH)]

<DOC>






116th CONGRESS
  2d Session
                                H. R. 7439

   To establish the Retirement Savings Lost and Found, and for other 
                               purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              July 1, 2020

Ms. Bonamici (for herself and Mr. Banks) introduced the following bill; 
which was referred to the Committee on Ways and Means, and in addition 
      to the Committee on Education and Labor, for a period to be 
subsequently determined by the Speaker, in each case for consideration 
  of such provisions as fall within the jurisdiction of the committee 
                               concerned

_______________________________________________________________________

                                 A BILL


 
   To establish the Retirement Savings Lost and Found, 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 ``Retirement Savings Lost and Found 
Act''.

SEC. 2. RETIREMENT SAVINGS LOST AND FOUND.

    (a) Retirement Savings Lost and Found.--
            (1) Establishment.--
                    (A) In general.--Not later than 2 years after the 
                date of the enactment of this Act, the Commissioner of 
                Social Security and the Secretary of the Treasury in 
                cooperation shall establish an online mechanism to be 
                known as the ``Retirement Savings Lost and Found'', to 
                be managed by the Director of the Retirement Savings 
                Lost and Found established under subsection (c) of this 
                section--
                            (i) to allow an individual to search for 
                        information that enables the individual to 
                        locate the plan administrator of any plans with 
                        respect to which the individual is a 
                        participant or beneficiary, and to provide 
                        contact information for the plan administrator 
                        of any plan described in subparagraph (B) with 
                        respect to which the individual may be entitled 
                        to a benefit;
                            (ii) to allow such Director to assist such 
                        an individual in locating any plan of the 
                        individual; and
                            (iii) to allow such Director to make any 
                        necessary changes to contact information on 
                        record for the plan administrator based on any 
                        changes to the plan due to merger or 
                        consolidation of the plan with any other plan, 
                        division of the plan into two or more plans, 
                        bankruptcy, termination, change in name of the 
                        plan, change in name or address of the plan 
                        administrator, or other causes.
                The Retirement Savings Lost and Found established under 
                this paragraph shall contain the information obtained 
                by the Commissioner of Social Security regarding 
                deferred vested benefits under section 6057 of the 
                Internal Revenue Code of 1986 (including information so 
                obtained before the date of the enactment of this Act). 
                Such information shall be retained in the Retirement 
                Savings Lost and Found in perpetuity.
                    (B) Plans described.--A plan described in this 
                subparagraph is a plan to which the vesting standards 
                of section 203 of part 2 of subtitle B of title I of 
                the Employee Retirement Income Security Act of 1974 
                apply.
            (2) Administration.--The Retirement Savings Lost and Found 
        established under paragraph (1) shall provide individuals 
        described in paragraph (1)(A) only with the ability to view 
        contact information for the plan administrator of any plan with 
        respect to which the individual is a participant or 
        beneficiary, sufficient to allow the individual to locate the 
        individual's plan.
            (3) Current information.--
                    (A) In general.--Paragraph (2) of section 6057(a) 
                of the Internal Revenue Code of 1986 is amended--
                            (i) in subparagraph (C)--
                                    (I) by striking ``during such plan 
                                year'' in clause (i) and inserting 
                                ``during the plan year immediately 
                                preceding such plan year'';
                                    (II) by adding ``and'' at the end 
                                of clause (i); and
                                    (III) by striking clause (iii);
                            (ii) by redesignating subparagraph (E) as 
                        subparagraph (G);
                            (iii) by striking ``and'' at the end of 
                        subparagraph (D); and
                            (iv) by inserting after subparagraph (D) 
                        the following new subparagraphs:
                    ``(E) the name and taxpayer identifying number of 
                each participant or former participant in the plan--
                            ``(i) who, during any previous plan year, 
                        was reported under subparagraph (C), and with 
                        respect to whom the benefits described in 
                        subparagraph (C)(ii) were fully paid during the 
                        plan year,
                            ``(ii) with respect to whom any amount was 
                        distributed under section 401(a)(31)(B) during 
                        the plan year, or
                            ``(iii) with respect to whom a deferred 
                        annuity contract was distributed during the 
                        plan year,
                    ``(F) in the case of a participant or former 
                participant to whom subparagraph (E) applies--
                            ``(i) in the case of a participant 
                        described in clause (ii) thereof, the name and 
                        address of the designated trustee or issuer 
                        described in section 401(a)(31)(B)(i) and the 
                        account number of the individual retirement 
                        plan to which the amount was distributed, and
                            ``(ii) in the case of a participant 
                        described in clause (iii) thereof, the name and 
                        address of the issuer of such annuity contract 
                        and the contract or certificate number, and''.
                    (B) Rules relating to direct trustee-to-trustee 
                transfers.--
                            (i) In general.--Paragraph (6) of section 
                        402(e) of such Code is amended--
                                    (I) by striking ``transfers.--Any'' 
                                and inserting ``transfers.--
                    ``(A) In general.--Any''; and
                                    (II) by adding at the end the 
                                following new subparagraph:
                    ``(B) Notification of trustee.--In the case of a 
                distribution under section 401(a)(31)(B), the plan 
                administrator shall notify the designated trustee or 
                issuer described in clause (i) thereof that the 
                transfer is a mandatory distribution required by such 
                section.''.
                            (ii) Penalty.--Subsection (i) of section 
                        6652 of such Code is amended--
                                    (I) by striking ``to Recipients'' 
                                in the heading and inserting ``or 
                                Notification'';
                                    (II) by striking ``402(f),'' and 
                                inserting ``402(f) or a notification as 
                                required by section 402(e)(6)(B),''; 
                                and
                                    (III) by striking ``such written 
                                explanation'' and inserting ``such 
                                written explanation or notification''.
                            (iii) Reports.--Subsection (i) of section 
                        408 of such Code is amended--
                                    (I) by redesignating subparagraphs 
                                (A) and (B) of paragraph (2) as clauses 
                                (i) and (ii), respectively, and by 
                                moving such clauses 2 ems to the right;
                                    (II) by redesignating paragraphs 
                                (1) and (2) as subparagraphs (A) and 
                                (B), respectively, and by moving such 
                                subparagraphs 2 ems to the right;
                                    (III) by striking ``as the 
                                Secretary prescribes'' in subparagraph 
                                (B)(ii), as so redesignated, and all 
                                that follows through ``a simple 
                                retirement account'' and inserting ``as 
                                the Secretary prescribes.
            ``(3) Simple retirement accounts.--In the case of a simple 
        retirement account'';
                                    (IV) by striking ``Reports.--The 
                                trustee of'' and inserting ``Reports.--
            ``(1) In general.--The trustee of'';
                                    (V) by striking ``under paragraph 
                                (2)'' in paragraph (3), as redesignated 
                                by clause (iii), and inserting ``under 
                                paragraph (1)(B)''; and
                                    (VI) by inserting after paragraph 
                                (1)(B)(ii), as redesignated by the 
                                preceding clauses, the following new 
                                paragraph:
            ``(2) Mandatory distributions.--In the case of an account, 
        contract, or annuity to which a transfer under section 
        401(a)(31)(B) is made (including a transfer from the individual 
        retirement plan to which the original transfer under such 
        section was made to another individual retirement plan), the 
        report required by this subsection for the year of the transfer 
        shall--
                    ``(A) identify such transfer as a mandatory 
                distribution required by such section,
                    ``(B) include the name, address, and taxpayer 
                identifying number of the trustee or issuer of the 
                individual retirement plan to which the amount is 
                transferred, and
                    ``(C) be filed with the Director of the Retirement 
                Savings Lost and Found established under section 
                2(a)(1) of the Retirement Savings Lost and Found Act as 
                well as with the Secretary.''.
                    (C) Notification of participants upon separation.--
                Subsection (e) of section 6057 of such Code is amended 
                by inserting ``, and a notice of the availability of 
                the Retirement Savings Lost and Found established under 
                section 2(a)(1) of the Retirement Savings Lost and 
                Found Act'' before the period at the end of the second 
                sentence.
                    (D) Effective date.--The amendments made by this 
                paragraph shall apply to distributions made in, and 
                returns and reports relating to, years beginning after 
                the second December 31 occurring after the date of the 
                enactment of this Act.
            (4) Coordination with distribution requirements, fiduciary 
        duties, etc.--
                    (A) Amendment of internal revenue code of 1986.--
                Paragraph (9) of section 401(a) of the Internal Revenue 
                Code of 1986, as amended by the preceding provisions of 
                this Act, is further amended by adding at the end the 
                following new subparagraph:
                    ``(K) Coordination with retirement savings lost and 
                found.--
                            ``(i) In general.--With respect to any lost 
                        or missing participant of a plan, the plan 
                        shall not be treated as failing to satisfy the 
                        requirements of this paragraph or any other 
                        requirement of this title which cannot be 
                        satisfied due to the plan's inability to locate 
                        the participant.
                            ``(ii) Lost or missing participant.--For 
                        purposes of subclause (i), the term `lost or 
                        missing participant' shall be defined in 
                        guidance to be issued jointly by the Internal 
                        Revenue Service, Department of the Treasury, 
                        the Employee Benefits Security Administration, 
                        Department of Labor, and the Pension Benefit 
                        Guaranty Corporation. Such guidance shall be so 
                        issued not later than 1 year after the date of 
                        the enactment of this subparagraph.''.
                    (B) Amendment of employee retirement income 
                security act of 1974.--
                            (i) In general.--Section 404 of the 
                        Employee Retirement Income Security Act of 1974 
                        (29 U.S.C. 1104) is amended by adding at the 
                        end the following new subsection:
    ``(e) Coordination With Retirement Savings Lost and Found.--
            ``(1) In general.--With respect to any lost or missing 
        participant of a plan, a fiduciary of the plan shall not be 
        treated as failing to satisfy any requirement to search for or 
        attempt to locate, or to provide any document or information 
        to, such individual, or any other requirement of this title 
        which cannot be satisfied due to the plan's inability to locate 
        the participant.
            ``(2) Lost or missing participant.--For purposes of 
        paragraph (1), the term `lost or missing participant' shall be 
        defined in guidance to be issued jointly by the Internal 
        Revenue Service, Department of the Treasury, the Employee 
        Benefits Security Administration, Department of Labor, and the 
        Pension Benefit Guaranty Corporation. Such guidance shall be so 
        issued not later than 1 year after the date of the enactment of 
        this subsection.''.
                            (ii) Conforming amendments.--Section 
                        4050(a)(1) of the Employee Retirement Income 
                        Security Act of 1974 (29 U.S.C. 1350(a)(1)) is 
                        amended in subparagraph (B)--
                                    (I) by striking ``provides'' and 
                                inserting ``either--
                            ``(i) provides'';
                                    (II) by striking the period at the 
                                end and inserting ``; or''; and
                                    (III) by adding at the end the 
                                following new clause:
                            ``(ii) satisfies the requirements of 
                        section 6057(a) of the Internal Revenue Code of 
                        1986.''.
            (5) Requirement of electronic filing.--
                    (A) In general.--Paragraph (2) of section 6011(e) 
                of the Internal Revenue Code of 1986 is amended--
                            (i) by redesignating subparagraphs (A) and 
                        (B) as clauses (i) and (ii), respectively, and 
                        by moving such clauses 2 ems to the right;
                            (ii) by striking ``regulations.--In 
                        prescribing'' and inserting ``regulations.--
                    ``(A) In general.--In prescribing''; and
                            (iii) by adding at the end the following 
                        new subparagraph:
                    ``(C) Exceptions.--Notwithstanding subparagraph 
                (A), the Secretary shall require returns or reports 
                required under--
                            ``(i) sections 6057, 6058, and 6059, and
                            ``(ii) sections 408(i), 6041, and 6047 to 
                        the extent such return or report relates to the 
                        tax treatment of a distribution from a plan, 
                        account, contract, or annuity,
                to be filed on magnetic media, but only with respect to 
                persons who are required to file at least 50 returns 
                during the calendar year which includes the first day 
                of the plan year to which such returns or reports 
                relate.''.
                    (B) Effective date.--The amendments made by this 
                paragraph shall apply to returns and reports relating 
                to years beginning after the second December 31 
                occurring after the date of the enactment of this Act.
            (6) Safeguarding participant privacy and security.--In 
        establishing the Retirement Savings Lost and Found under 
        paragraph (1), the Commissioner of Social Security and the 
        Secretary of the Treasury shall take all necessary and proper 
        precautions, including consulting with the Secretary of Health 
        and Human Services, to ensure that individuals' plan 
        information maintained by the Retirement Savings Lost and Found 
        is protected and that persons other than the individual cannot 
        fraudulently claim the benefits to which any individual is 
        entitled, and to allow any individual to opt out of inclusion 
        in the Lost and Found at the election of the individual.
            (7) Conforming amendment.--Subparagraph (B) of section 
        6103(l)(1) of the Internal Revenue Code of 1986 is amended by 
        striking ``responsibility under section 1131 of the Social 
        Security Act'' and inserting ``responsibilities under section 
        1131 of the Social Security Act and section 2(a)(1)(A) of the 
        Retirement Savings Lost and Found Act''.
            (8) Authorization of appropriations.--There are authorized 
        to be appropriated such sums as may be necessary to carry out 
        the purposes of this subsection.
    (b) Mandatory Transfers of Rollover Distributions.--
            (1) Investment options.--
                    (A) In general.--Subparagraph (B) of section 
                404(c)(3) of the Employee Retirement Income Security 
                Act of 1974 (29 U.S.C. 1104(c)(3)) is amended by 
                striking the period at the end and inserting ``, and, 
                to the extent the Secretary provides in guidance or 
                regulations issued after the enactment of this Act, is 
                made to--
                            ``(i) a target date or life cycle fund held 
                        under such account;
                            ``(ii) as described in section 2550.404a-2 
                        of title 29, Code of Federal Regulations, an 
                        investment product held under such account 
                        designed to preserve principal and provide a 
                        reasonable rate of return;
                            ``(iii) the Director of the Retirement 
                        Savings Lost and Found in accordance with 
                        section 2(c)(2)(A)(ii) of the Retirement 
                        Savings Lost and Found Act or an individual 
                        retirement account (as defined in section 
                        408(a) of the Internal Revenue Code of 1986) 
                        established by the Secretary of the Treasury on 
                        behalf of the participant or beneficiary, but 
                        only if all applicable reporting requirements 
                        are met with respect to such transfer; or
                            ``(iv) such other option as the Secretary 
                        may so provide.''.
                    (B) Regulations.--Not later than 270 days after the 
                date of the enactment of this Act, the Secretary of 
                Labor shall promulgate regulations identifying the 
                target date or life cycle funds, or specifying the 
                characteristics of such a fund, that will be deemed to 
                meet the requirements of section 404(c)(3)(B)(i) of the 
                Employee Retirement Income Security Act of 1974 (29 
                U.S.C. 1104(c)(3)(B)), as amended by subparagraph (A).
            (2) Expansion of cap; authority to transfer lesser 
        amounts.--
                    (A) Cap.--Sections 401(a)(31)(B)(ii) and 
                411(a)(11)(A) of the Internal Revenue Code of 1986 and 
                section 203(e)(1) of the Employee Retirement Income 
                Security Act of 1974 are each amended by striking 
                ``$5,000'' and inserting ``$6,000''.
                    (B) Lesser amounts.--Subparagraph (B) of section 
                401(a)(31) of such Code is amended by adding at the end 
                the following new clauses:
                            ``(iii) Treatment of lesser amounts.--In 
                        the case of a trust which is part of an 
                        eligible plan, such trust shall not be a 
                        qualified trust under this section unless such 
                        plan provides that, if a participant in the 
                        plan separates from the service covered by the 
                        plan and the nonforfeitable accrued benefit 
                        described in clause (ii) is not in excess of 
                        $1,000, the plan administrator shall (either 
                        separately or as part of the notice under 
                        section 402(f)) notify the participant that the 
                        participant is entitled to such benefit or 
                        attempt to pay the benefit directly to the 
                        participant.
                            ``(iv) Transfers to retirement savings lost 
                        and found or treasury.--If, after a plan 
                        administrator takes the action required under 
                        clause (iii), the participant does not--
                                    ``(I) within 6 months of the 
                                notification under such clause, make an 
                                election under subparagraph (A) or 
                                elect to receive a distribution of the 
                                benefit directly, or
                                    ``(II) accept any direct payment 
                                made under such clause within 6 months 
                                of the attempted payment,
                        the plan administrator shall transfer the 
                        amount of such benefit to the Director of the 
                        Retirement Savings Lost and Found in accordance 
                        with section 2(c)(2)(a)(ii) of the Retirement 
                        Savings Lost and Found Act or to an individual 
                        retirement account (as defined in section 
                        408(a)) established by the Secretary on behalf 
                        of the individual.
                            ``(v) Income tax treatment of transfers to 
                        retirement savings lost and found.--For 
                        purposes of determining the income tax 
                        treatment of transfers to the Director of the 
                        Retirement Savings Lost and Found under clause 
                        (iv)--
                                    ``(I) such a transfer shall be 
                                treated as a transfer to an individual 
                                retirement plan under clause (i), and
                                    ``(II) the distribution of such 
                                amounts by the Director of the 
                                Retirement Savings Lost and Found shall 
                                be treated as a distribution from an 
                                individual retirement plan.''.
                    (C) Effective date.--The amendments made by this 
                paragraph shall apply to vested benefits with respect 
                to participants who separate from service connected to 
                the plan in plan years beginning after the second 
                December 31 occurring after the date of the enactment 
                of this Act.
                    (D) Rule of construction.--Nothing in this section 
                shall be interpreted to prohibit a plan administrator 
                from transferring the accounts of missing participants 
                to the Pension Benefit Guaranty Corporation pursuant to 
                section 4050 of the Employee Retirement Income Security 
                Act of 1974.
    (c) Office of the Retirement Savings Lost and Found.--
            (1) In general.--Not later than one year after the date of 
        the enactment of this Act, the Commissioner of Social Security 
        and the Secretary of the Treasury shall establish within the 
        appropriate agency or subdivision thereof an Office of the 
        Retirement Savings Lost and Found, to be administered by a 
        Director of the Retirement Savings Lost and Found who (without 
        regard to the agency or subdivision where such Office is 
        established) shall report to both such Commissioner and such 
        Secretary.
            (2) Responsibilities of director.--
                    (A) In general.--In addition to administering the 
                Retirement Savings Lost and Found under subsection (a) 
                and carrying out the duties described in clauses (ii) 
                and (iii) of subsection (a)(1)(A), the Director of the 
                Retirement Savings Lost and Found established under 
                this section shall--
                            (i) perform an annual audit of plan 
                        information contained in the Retirement Savings 
                        Lost and Found and ensure that such information 
                        is current and accurate;
                            (ii) invest any amount transferred under 
                        section 401(a)(31)(B)(iv) of the Internal 
                        Revenue Code of 1986 in United States Treasury 
                        securities; and
                            (iii) upon application filed by the 
                        participant or beneficiary in such form and 
                        manner as may be prescribed in regulations, pay 
                        to the participant or beneficiary the amount 
                        transferred (or the appropriate survivor 
                        benefit) either--
                                    (I) in a single sum (plus 
                                interest); or
                                    (II) in such other form as is 
                                specified in regulations; and
                            (iv) identify such amount as eligible to be 
                        paid into an eligible retirement plan described 
                        in section 402(c)(8)(B) of the Internal Revenue 
                        Code of 1986.
                    (B) Option to contract.--The Director of the 
                Retirement Savings Lost and Found shall conduct an 
                analysis of the cost effectiveness of contracting with 
                a third party to carry out the responsibilities under 
                subparagraph (A) and, if the Director determines that 
                it would be more cost effective to do so than to carry 
                out such responsibilities within the Office of the 
                Retirement Savings Lost and Found, the Director shall 
                report to the Committees on Finance and Health, 
                Education, Labor, and Pensions of the Senate and the 
                Committees on Ways and Means and Education and Labor of 
                the House of Representatives the intention to so 
                contract.
                    (C) Option to prescribe protocols.--The Director of 
                the Retirement Savings Lost and Found may establish 
                protocols to assist participants originally treated as 
                lost or missing in claiming their benefits under a 
                plan.
                    (D) Coordination.--The Director of the Retirement 
                Savings Lost and Found shall coordinate with the 
                Pension Benefit Guaranty Corporation and other 
                applicable agencies to integrate information and 
                databases on lost, missing, and inactive participants.
                                 <all>