By SEMA Washington, D.C., Staff
The U.S. House of Representatives passed a bill to expand retirement savings programs by a margin of 417 to 3. The “Setting Every Community Up for Retirement Enhancement (SECURE) Act of 2019,” (H.R. 1944) represents the most comprehensive plan to modify the U.S. retirement system in more than a decade. A similar bill is being considered by the U.S. Senate.
The SECURE Act makes it easier for small businesses to join multiple employer plans by not requiring businesses to be affiliated, increases tax credits for small businesses adopting a retirement plan, permits part-time employees to enroll in 401(k) plans, increases the age when individuals must start withdrawing money from an IRA from 70½ to 72, repeals the age cap on contributing to an IRA (currently 70½), and protects employers offering annuities from liability if the insurance company administering the plan is not able to make payments.
While many of these provisions are favorable for small businesses and workers, SEMA is concerned by sections of the bill designed to offset the loss of revenue to the federal government, including a provision to limit the amount of time individuals inheriting a retirement account have to withdraw funds (surviving spouses, the disabled and chronically ill, and children under the age of 10 are exempt). SEMA also objects to the bill’s increased penalties charged to businesses that fail to file retirement plan returns, which would largely impact small businesses.
For more information, contact Eric Snyder at email@example.com.