Seven Republican U.S. senators sent a letter to Senate Majority Leader Mitch McConnell (R-Ky.) urging immediate Senate consideration of the bipartisan Setting Every Community Up for Retirement Enhancement Act, or SECURE Act.
The sweeping legislation, which would expand retirement options for Americans, would be the first real major retirement reform since the Pension Protection Act in 2006. It was passed by the House in a 417-3 vote in May, but McConnell has yet to put the bill up for a Senate vote.
“We encourage the Senate to take action on the SECURE Act as soon as possible. Doing so demonstrates to our constituents that the Senate can lead in a bipartisan way for workers saving for retirement, tax fairness, and family financial security,” Sen. Tim Scott (R-S.C.) said in the letter.
“This bipartisan legislation would expand access to retirement plans for millions of Americans, allow older workers and retirees to contribute more to their retirement accounts, increase 401(k) coverage to part-time employees [and] prevent as many as four million people in private-sector pension plans from losing future benefits,” Scott added.
He was joined in the letter by senators Susan Collins (R-Maine), Joni Ernst (R-Iowa), Cory Gardner (R-Colo.), Rob Portman (R-Ohio), Martha McSally (R-Ariz.) and Thom Tillis (R-N.C.).
The SECURE Act would expand multiple employer plans (MEPs) to make employee-sponsored retirement plans more accessible and favorable to small business owners.
The legislation also increases the tax credit available to small businesses that start a new retirement plan for their workers from $500 per year to up to $5,000 per year for three years, meaning the maximum credit is now $15,000 over three years.
“There’s so much momentum for this bill, which is good for small business owners and their employees,” said Susan K. Neely, president and CEO of the American Council of Life Insurers.
"It’s the perfect time for the Senate to act and get this common sense, important bipartisan legislation over the finish line—securing millions of Americans’ financial futures,” Neely added.
In addition to increasing the likelihood of small employers starting retirement plans, including providing a tax credit for those who create automatic enrollment for employees, the legislation would remove the age limits on IRA contributions, extend the start date for required minimum distributions and increase annuity options inside retirement plans.