April 3, 2019
Bipartisan Retirement Bill Proposed
The 2019 version of the “Retirement Enhancement and Savings Act” (RESA) has been introduced in the Senate with bipartisan support. RESA would make several changes to retirement plans, including allowing long-term, part-time employees to participate in employer 401(k) plans, broader use of multiple employer plans and simplifying 401(k) plan safe harbor rules. Additionally, it encourages employee investment in retirement plans by automatically increasing the annual contribution limit to 401(k) plans, removing the age limit on contributions to traditional IRAs, and increasing the age for mandatory distributions to 72.
RESA closely mirrors the House’s bipartisan “Setting Every Community Up for Retirement Enhancement Act” (SECURE). Retirement reform advocates say both bills reflect “the best ideas” arising out of over a decade of lawmakers’ discussions on comprehensive retirement security.
A series of recent reports indicate that many Americans have little or no retirement savings or plans, and provisions of both SECURE and RESA are designed to make it easier to understand and effectively contribute.
The SECURE Act has passed through the House Ways and Means Committee, and a House floor vote is expected soon. Previous iterations of RESA and SECURE have failed in Congress, but the increased bipartisan support may mean that a measure could be sent to President Trump by the end of the year.