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Private Sector MEPs Would Return in House Bill

U.S. Rep. Vern Buchanan (R-Fla.) has introduced bipartisan legislation to make it easier for small businesses to offer retirement benefits to employees. It’s not the first time Buchanan has done so; he introduced an earlier iteration in the waning days of the 114th Congress in December 2016.

H.R. 854, The Retirement Security for American Workers Act, co-sponsored by Rep. Rich Neal (D-Mass.), the top Democrat on the House Ways & Means Committee, as well as Reps. Ron Kind (D-Wisc.) and Jim Renacci (R-Ohio), is intended to make it less costly for small businesses to set up retirement plans.

Specifically, the Retirement Security for American Workers Act lets businesses join together in multiple employer plans (MEPs) with pooled plan providers to share the administrative burden and costs of offering a retirement plan. It would amend Internal Revenue Code Section 413 by adding a new subsection (e), “Application of Qualification Requirements for Certain Multiple Employer plans with Pooled Plan Providers” at its end.

The proposed subsection says that, subject to certain limitations, if a defined contribution plan to which subsection (c) applies is sponsored by employers that both have a common interest other than having adopted the plan and control the plan, or has a pooled plan provider, the plan shall not be treated as failing to meet the requirements under this title applicable to a plan described in Code Section 401(a) or to a plan that consists of IRAs, merely because one or more employers of employees covered by the plan fail to take the actions required of such employers for the plan to meet such requirements.

The bill was referred to two House committees: Ways and Means, and Education and the Workforce.