Retirement Savings bill

TABLE OF CONTENTS:

Title I: Pension Access and Coverage

Subtitle A: Improved Access to Individual Retirement

Savings

Subtitle B: Improved Fairness in Retirement Plan

Benefits

Subtitle C: Improving Retirement Plan Coverage

Subtitle D: Simplifying Plan Requirements

Title II: Security

Subtitle A: General Provisions

Subtitle B: ERISA Enforcement

Title III: Portability

Title IV: Toward Equity for Women

Title V: Date for Adoption of Plan Amendments

Retirement Security Act of 1997 - Title I: Pension Access and Coverage - Subtitle A: Improved Access to Individual Retirement Savings - Chapter 1: Contributions To Individual Retirement Plans Through Payroll Deductions - Amends the Internal Revenue Code (IRC) to establish, through a private entity awarded a contract by the Secretary of Labor, a payroll deduction and investment system, under which: (1) eligible employees, through employer payroll deductions, may make contributions to individual retirement plans; and (2) amounts in the individual retirement plans are invested according to certain requirements.

(Sec. 103) Sets forth system provisions for: (1) contributions to individual retirement plans; (2) investment options; (3) accounting and information; (4) administrative costs; (5) fiduciary responsibilities, liability and penalties, bonding, and investigative authority; and (6) selection of contractor.

(Sec. 108) Authorizes appropriations: (1) for the Secretary of Labor to design and award the contract for such system; and (2) for the contractor to begin operations under this chapter.

Chapter 2: Nonrefundable Tax Credit for Contributions to Individual Retirement Accounts - Amends IRC to allow a nonrefundable tax credit for a portion of contributions to individual retirement plans, calculated according to a specified scale.

Chapter 3: Expanded Individual Retirement Accounts to Increase Coverage and Portability - Subchapter A: IRA Deduction - Raises the income limitations for the individual retirement account (IRA) tax deduction, with a corresponding adjustment to the formula for the phaseout of such limitations.

(Sec. 122) Prescribes an inflation adjustment for the IRA deductible amount and income limitations.

Subchapter B: Distributions and Investments - Allows the use of distributions from individual retirement plans, without additional tax, to: (1) purchase first homes; (2) pay higher education expenses; or (3) pay financially devastating medical expenses.

(Sec. 132) Requires that contributions to individual retirement plans (other than special individual retirement accounts) be held for at least five years in certain cases before they may be distributed without specified tax consequences.

Chapter 4: Periodic Pension Benefits Statements - Amends the Employee Retirement Income Security Act of 1974 (ERISA) to revise provisions relating to periodic pension benefits statements in cases of defined benefit plans, defined contribution plans, and multiemployer plans.

Subtitle B: Improved Fairness in Retirement Plan Benefits - Amends IRC to require a specified minimum employer contribution to simple retirement accounts. Provides for an option to suspend employer contributions. Amends ERISA with respect to fiduciary duties in the case of such accounts.

(Sec. 152) Sets forth various nondiscrimination rules for qualified cash or deferred arrangements and matching contributions.

(Sec. 153) Increases from $75,000 to $80,000 one of the compensation criteria for a highly compensated employee. Excludes specified categories of employees from the meaning of highly compensated employee.

Subtitle C: Improving Retirement Plan Coverage - Allows a tax credit for the qualified start-up costs of eligible small employers in establishing a qualified pension plan or qualified employer payroll deduction system.

(Sec. 162) Sets forth a special limitation rule for governmental and multiemployer plans, allowing annual benefits of up to $90,000. Exempts certain excess benefit arrangements from the $7,500 or one third of includible compensation limit for annual benefits. Prohibits such benefits from being taken into account in determining whether any other plan is an eligible deferred compensation plan. Provides a similar annual benefit exemption for survivor and disability benefits under multiemployer plans.

(Sec. 163) Declares that compensation deferred under a mirror plan shall not be taken into account in applying certain limits (with respect to deferred compensation plans of State and local governments and tax-exempt organizations) to compensation deferred under any other deferred compensation plan.

(Sec. 164) Sets forth special rules to treat contributions by self-employed individuals as matching contributions.

(Sec. 165) Amends specified Federal law relating to Federal employees to allow immediate participation in the Thrift Savings Plan for Federal employees by eliminating certain waiting periods for purposes of employee contributions.

(Sec. 166). Amends the IRC to revise the limits on contributions excluded from the calculation of non-deductible contributions for purposes of the tax on non-deductible contributions to a qualified employer plan.

Subtitle D: Simplifying Plan Requirements - Amends IRC and ERISA to set a full funding limitation for multiemployer plans.

(Sec. 172) Eliminates IRC partial termination rules for multiemployer plans.

(Sec. 173) Revises IRC nondiscrimination and minimum participation rules with respect to governmental plans.

(Sec. 174) Eliminates specified ERISA requirements for plan descriptions and for filing of summary plan descriptions and descriptions of material modifications to a plan.

(Sec. 175) Directs the Secretaries of the Treasury and of Labor to expand their efforts to examine existing guidance regarding notice, recordkeeping, and operational requirements for retirement plans, in order to permit the use of new technologies by plan sponsors and administrators in ways which maintain the protection of the rights of participants and beneficiaries.

Title II: Security - Subtitle A: General Provisions - Amends ERISA to provide investment protection for specified plans that include qualified cash or deferred arrangements under IRC (401(k) plans) by setting limitations on investment in employer securities and employer real property by cash or deferred arrangements. Provides a transition rule for plans holding excess securities or property.

(Sec. 202) Applies an ERISA requirement for annual, detailed investment reports to certain IRC 401(k) plans. Directs the Secretary of Labor, in prescribing regulations for required information in such reports, to consider including specified types of information.

(Sec. 203) Directs the Secretary of Labor to study and report to the Congress on: (1) the extent to which pension plans invest in collectibles; and (2) whether such investments present a risk to the pension security of the participants and beneficiaries of such plans.

(Sec. 204) Amends IRC to prohibit qualified employer plans from making loans through credit cards and other intermediaries.

(Sec. 205) Increases the amounts of multiemployer plan benefits guaranteed under ERISA.

(Sec. 206) Increases the maximum amount of the civil penalty which may be assessed administratively for certain prohibited transactions.

(Sec. 207) Amends ERISA with respect to substantial owner benefits to revise the phase-in of guarantee and the allocation of assets.

(Sec. 208) Directs the Secretary of Labor to report annually to the President and the Congress on plans from which residual assets were distributed to employers (reversion report).

(Sec. 209) Expresses the sense of the Congress that the Secretary of the Treasury should: (1) review existing correction mechanisms to determine whether modifications might facilitate additional utilization by sponsors, improve voluntary compliance, and hasten the correction of pension plans; (2) consider whether additional means of addressing nonegregious violations should be explored; and (3) make appropriate legislative recommendations.

Subtitle B: ERISA Enforcement - Amends ERISA enforcement provisions to repeal a limited scope audit requirement for employee pension benefit plans. Requires an accountant, in offering an opinion in the case of an employee pension benefit plan, to rely, to the extent consistent with generally accepted auditing standards, on the work of any independent public accountant of any bank or similar institution or insurance carrier that holds assets or processes transactions of the employee pension benefit plan, provided that such bank, institution, or insurance carrier is regulated, supervised, and subject to periodic examination by a State or Federal agency.

(Sec. 212) Sets forth additional ERISA requirements for qualified public accountants.

(Sec. 213) Amends ERISA and the IRC to exempt from the prohibition against assignment or alienation of an accrued pension benefit offsets for certain civil and criminal judgments against fiduciaries. Changes from mandatory to discretionary the imposition and amount of civil penalties for breach of fiduciary responsibilities.

Title III: Portability - Amends ERISA and the IRC to provide for faster vesting of employer matching contributions.

(Sec. 302) Revises certain restrictions on distributions from IRC 401(k) plans.

(Sec. 303) Amends ERISA and IRC with respect to accrued benefit not to be decreased by plan amendment to revise the treatment of transfers between defined contribution plans.

(Sec. 304) Amends ERISA rules requiring transfer of benefits of missing participants to direct the Pension Benefit Guaranty Corporation (PBGC) to prescribe similar rules for multiemployer plans that terminate. Requires transfer of missing participants' plan benefits to the PBGC by certain plans not otherwise subject to ERISA enforcement provisions.

Title IV: Toward Equity for Women - Amends the IRC with respect to limitations on the deduction for active participants in certain pension plans to provide that an individual's participation in plan is not treated as participation by the individual's spouse.

(Sec. 402) Modifies ERISA and IRC requirements for joint and survivor annuities to provide for an alternative joint and two-thirds survivor annuity payable while both the participant and the spouse are alive.

(Sec. 403) Amends the IRC and ERISA with respect to division of pension benefits upon divorce to deem any State divorce decree to be a domestic relations order specifying that half of the marital share of the participant's accrued benefit is to be provided to the former spouse.

(Sec. 404) Amends Federal civil service law to revise requirements for: (1) election of alternative deferred annuities by the surviving spouses of Federal employees; and (2) payment of lump-sum credit for former spouses of Federal employees (to state that payment to a person bars recovery by any other person).

(Sec. 406) Directs the Secretary of Labor to contract with an independent organization to create a women's pension toll-free phone number and contact. Authorizes appropriations.

Title V: Date for Adoption of Plan Amendments - Sets forth dates for adoption of plan amendments.