Secure, Accessible, Valuable, Efficient Universal Pension Accounts Act or the SAVE UP Act
This bill amends the Internal Revenue Code to establish the SAVE UP Account program to provide tax-exempt retirement accounts to employees who are not otherwise eligible for certain retirement plans.
The bill establishes: (1) a board of trustees to create and manage the accounts, (2) a board of governors to establish policies for the investment and management of fund assets, and (3) a trust fund and accounts in the Treasury for the program.
An employer must establish an account contribution program if: (1) the employer's aggregate number of employee hours of service during the preceding year was at least 1,600; (2) the employer does not offer a retirement plan to all employees. Government entities and churches are exempt from this requirement.
Under the contribution program, employers must: (1) contribute at least 50 cents per hour worked by the employee; and (2) make automatic contributions on behalf of employees who do not opt-out, beginning with 3% of wages and eventually increasing to 5%.
The bill sets forth requirements for: (1) determining an employee's share of positive net investment returns, and (2) paying benefits from the accounts in the form of an annuity
The bill allows a tax credit for certain small employers who elect to set up contribution programs for their employees.
If an employer fails to maintain a required contribution program, the bill disallows the deduction for compensation for services performed by employees of the employer.
[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5731 Introduced in House (IH)]
<DOC>
114th CONGRESS
2d Session
H. R. 5731
To establish SAVE UP Accounts, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
July 12, 2016
Mr. Crowley introduced the following bill; which was referred to the
Committee on Ways and Means
_______________________________________________________________________
A BILL
To establish SAVE UP Accounts, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Secure,
Accessible, Valuable, Efficient Universal Pension Accounts Act'' or the
``SAVE UP Act''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title and table of contents.
TITLE I--SAVE UP ACCOUNTS
Sec. 101. Secure, Accessible, Valuable, Efficient Universal Pension
Accounts.
Sec. 102. SAVE UP Account contribution programs.
Sec. 103. SAVE UP Accounts Fund.
Sec. 104. Investment of SAVE UP Account assets.
Sec. 105. Benefits in the form of an annuity.
Sec. 106. SAVE UP Accounts Governance.
Sec. 107. Reporting and Disclosure.
Sec. 108. Fiduciary duties under SAVE UP Account contribution programs
and SAVE UP Accounts.
Sec. 109. SAVE UP Accounts disregarded for purposes of means-tested
programs.
TITLE II--TAX TREATMENT OF SAVE UP ACCOUNTS
Sec. 201. Tax treatment of SAVE UP Accounts.
Sec. 202. SAVE UP Account credit.
Sec. 203. Disallowance of deduction for compensation for certain
employers failing to provide SAVE UP
Account contribution program.
TITLE I--SAVE UP ACCOUNTS
SEC. 101. SECURE, ACCESSIBLE, VALUABLE, EFFICIENT UNIVERSAL PENSION
ACCOUNTS.
(a) In General.--There is hereby established the ``SAVE UP Account
program'' under which the SAVE UP Board of Trustees shall--
(1) establish for each eligible employee of an applicable
employer a SAVE UP Account, and
(2) manage such accounts, and hold amounts in such account
in trust, for the exclusive benefit of the individuals on whose
behalf such accounts are established.
(b) Eligible Employee.--
(1) In general.--For purposes of this section, the term
``eligible employee'' means, with respect to any applicable
employer, any employee unless such employee is eligible to
participate in a plan or arrangement described in section
219(g)(5)(A) of the Internal Revenue Code of 1986.
(2) Exception for frozen plan.--Paragraph (1) shall not
apply in the case of a defined benefit plan unless the
participant is eligible to receive service-based accruals under
such plan.
(c) Applicable Employer.--For purposes of this title--
(1) In general.--The term ``applicable employer'' means,
with respect to any year, any employer--
(A)(i) the aggregate number of hours of service of
employees of which for months during the preceding
calendar year is 1,600 or more, and
(ii) which does not make available to all employees
a plan or arrangement described in section 219(g)(5) of
the Internal Revenue Code of 1986, or
(B) which elects the application of this title for
any year.
(2) Hours of service.--The SAVE UP Board of Governors, in
consultation with the Secretary of Labor, shall prescribe such
guidance as may be necessary to determine the hours of service
of employees, including with respect to employees who are not
compensated on an hourly basis.
(3) Government entities and churches.--The term
``applicable employer'' shall not include--
(A) a government or entity described in section
414(d) of the Internal Revenue Code of 1986; or
(B) a church or a convention or association of
churches that is exempt from tax under section 501 of
such Code.
(4) Aggregation rule.--All persons treated as a single
employer under subsection (b), (c), (m), or (o) of section 414,
of the Internal Revenue Code of 1986 shall be treated as a
single employer.
SEC. 102. SAVE UP ACCOUNT CONTRIBUTION PROGRAMS.
(a) In General.--Each applicable employer shall establish a SAVE UP
Account contribution program.
(b) SAVE UP Account Contribution Program.--
(1) In general.--For purposes of this part, the term ``SAVE
UP Account contribution program'' means, with respect to any
applicable employer, a written arrangement that meets the
requirements of paragraphs (2) through (5).
(2) Automatic deferral.--
(A) In general.--The requirements of this paragraph
are met if the SAVE UP Account contribution program
includes a SAVE UP Account cash or deferred arrangement
under which each eligible employee is treated as having
elected to have the employer make elective
contributions on the employee's behalf in an amount
equal to the applicable percentage of wages (as defined
in section 3121(a) without regard to the contribution
and benefit base limitation in paragraph (1) thereof).
(B) Election out.--The election treated as having
been made under subparagraph (A) shall cease to apply
with respect to any employee if such employee makes an
affirmative election--
(i) to not have such contributions made, or
(ii) to make elective contributions under
the SAVE UP Account cash or deferred
arrangement at a level specified in such
affirmative election.
(C) SAVE up account cash or deferred arrangement.--
For purposes of this subsection, the term ``SAVE UP
Account cash or deferred arrangement'' means an
arrangement under which the eligible employee may elect
to have the employer make payments as contributions
under the arrangement to the employee's SAVE UP Account
on behalf of the employee, or to the employee directly
in cash.
(D) Applicable percentage.--For purposes of this
paragraph, the term ``applicable percentage'' means,
with respect to any employee--
(i) 3 percent during the period ending on
the last day of the first calendar year which
begins after the date on which the first
elective contribution described in subparagraph
(A) is made with respect to such employee;
(ii) 3.5 percent during the first calendar
year following the calendar year described in
clause (i);
(iii) 4 percent during the second calendar
year following the calendar year described in
clause (i);
(iv) 4.5 percent during the third calendar
year following the calendar year described in
clause (i); and
(v) 5 percent during any subsequent
calendar year.
(3) Nonelective employer contributions.--The requirements
of this paragraph are met if, under the arrangement, the
employer, without regard to any election by the employee under
paragraph (2), is required to make a contribution to the plan
on behalf of each qualifying employee in an amount equal to at
least 50 cents per hour worked by the employee. Such
contribution shall not be counted as partial payment of an
hourly wage. An employer shall not fail to meet the
requirements of this paragraph solely by reason of making
contributions on behalf of employees at a rate greater than 50
cents per hour, but only if such contributions are made at the
same rate for all qualifying employees of the employer.
(4) Notices.--The requirements of this paragraph shall not
be treated as met with respect to any year unless the employer
notifies each employee eligible to participate, within a
reasonable period of time before the 30th day before the
beginning of such year (and, for the first year the employee is
so eligible, the 30th day before the first day such employee is
so eligible), of--
(A) the elective contributions that may be elected
or treated as elected under paragraph (2), and
(B) the opportunity to elect under paragraph
(2)(B)(i) to not make elective contributions.
(5) Treatment of contributions.--All contributions with
respect to an employee made under a SAVE UP Account
contribution program shall be nonforfeitable and shall be paid
over to the SAVE UP Accounts Fund for crediting to the
employee's SAVE UP Account under section 103.
(6) Wage growth adjustment.--
(A) In general.--In the case of calendar years
beginning after 2016, the 50 cent amount in paragraph
(3) shall be increased by the average annual wage
growth adjustment.
(B) Average annual wage growth adjustment.--For
purposes of subparagraph (A), the average annual wage
growth adjustment for any calendar year is the
percentage (if any) by which--
(i) the national average wage index (as
defined in section 219(k)(1) of the Social
Security Act) for the preceding calendar year,
exceeds
(ii) the national average wage index (as so
defined) for 2015.
(C) Rounding.--Adjustments under this paragraph
shall be rounded to the nearest cent.
SEC. 103. SAVE UP ACCOUNTS FUND.
(a) Establishment of Fund.--
(1) Establishment.--There is established in the Treasury of
the United States a trust fund to be known as the ``SAVE UP
Accounts Fund''.
(2) Amounts in fund.--The SAVE UP Accounts Fund shall
consist of amounts paid to SAVE UP Accounts pursuant to a SAVE
UP Account contribution programs, increased by the total net
earnings from investments of sums in the Fund attributable to
such deposited amounts, and reduced by the total net losses
from investments of such sums.
(3) Budget authority; appropriation.--This title
constitutes budget authority in advance of appropriations Acts
and represents the obligation of the SAVE UP Board of Trustees
to provide for the payment of amounts provided under this
title. The amounts held in the SAVE UP Accounts Fund are
appropriated and shall remain available without fiscal year
limitation.
(b) Accumulation Account.--There is established in the SAVE UP
Accounts Fund a separate account to be known as the ``Accumulations
Account'' consisting of such amounts described in subsection (a)(2),
less amounts credited to the Annuity Account.
(c) Annuity Account.--There is established in the SAVE UP Accounts
Fund a separate account to be known as the ``Annuity Account'' to which
the aggregate amounts credited to a participant's SAVE UP Account under
section 105 shall be transferred at such time as the participant elects
to start receiving benefit payments under section 106.
(d) Reserve Account.--
(1) In general.--There is established in the SAVE UP
Accounts Fund a separate account to be known as the ``Reserve
Account'' which shall represent the amounts described in
subsection (a)(2), less amounts credited to SAVE UP Accounts
under section 104(c).
(2) Use of reserve account.--The Board of Governors shall--
(A) use Reserve Account amounts that are allocable
to the investment of amounts in the Accumulation
Account to make up any shortfall in the crediting
individuals accounts under section 104(c), and
(B) use Reserve Account amounts that are allocable
to the investment of amounts in the Annuity Account to
make up any shortfall in the payment of annuity
benefits under section 105.
(e) Availability.--The sums in the SAVE UP Accounts Fund are
appropriated and shall remain available without fiscal year
limitation--
(1) to invest under section 104;
(2) to provide for the payment of benefits in accordance
with section 105; and
(3) to pay the administrative expenses incurred with
respect to management of SAVE UP Accounts and such Funds.
(f) Limitations on Use of Amounts in the Fund.--
(1) In general.--Amounts in the SAVE UP Accounts Fund
credited to an individual's SAVE UP Account are nonforfeitable
and may not be used for, or diverted to, purposes other than
for the exclusive benefit of the individual or the individual's
beneficiaries under this title.
(2) Assignments.--Amounts in the SAVE UP Accounts Fund
credited to an individual's SAVE UP Account may not be assigned
or alienated and are not subject to execution, levy,
attachment, garnishment, or other legal process.
SEC. 104. INVESTMENT OF SAVE UP ACCOUNT ASSETS.
(a) In General.--Amounts in the Accumulation Account of the SAVE UP
Accounts Trust Fund shall be invested by each SAVE UP Board of Trustees
under rules and guidance established by the SAVE UP Board of Governors.
Each SAVE UP Board of Trustees shall be responsible for investing an
amount (determined by the Board of Governors quarterly) that is
proportional to the credited balances of SAVE UP Accounts within such
Board's jurisdiction.
(b) Investment Returns.--
(1) Daily.--The SAVE UP Board of Governors shall determine
daily the net investment return of the entire SAVE UP Accounts
Trust Fund.
(2) Annual audit.--Not less than annually, the SAVE UP
Board of Governors shall, through an independent audit of each
SAVE UP Board of Trustee's investments, determine the net
investment return of the entire SAVE UP Accounts Trust Fund.
(c) Crediting of Accounts and Allocation of Positive Investment
Returns.--
(1) In general.--Each SAVE UP Board of Trustees shall
separately account for each individual's SAVE UP Account within
its jurisdiction and shall provide for crediting of--
(A) amounts contributed with respect to the
individual's account under section 102, and
(B) in the case of any period for which the SAVE UP
Accounts Trust Fund is determined by the SAVE UP Board
of Governors to have had an annualized positive net
investment return, an amount equal to the individual's
allocable share of such investment return.
(2) Allocation of investment return.--For purposes of
paragraph (1), an individual's allocable share of investment
returns shall be an amount equal to the return such
individual's SAVE UP Account would have experienced had such
return (annualized and expressed as a percentage) been equal to
the lesser of--
(A) 6 percent, or
(B) the SAVE UP Accounts Trust Fund annualized
investment return (expressed as a percentage)
determined by the SAVE UP Board of Governors.
SEC. 105. BENEFITS IN THE FORM OF AN ANNUITY.
(a) In General.--A SAVE UP Account shall pay benefits in the form
of an annuity in accordance with subsection (b). The amount of such
benefits shall be based on the amounts credited to the individual's
SAVE UP Account and the form of distribution the individual elects.
Notwithstanding the preceding sentence, the amount of an annuity may be
adjusted to reflect the experience of the Fund as necessary to protect
the financial integrity of the Fund, except that annuity payments for
those in pay status shall not be reduced more than 5 percent per year
unless the Fund is faced with a significant financial hardship and the
SAVE UP Board of Governors has approved the reduction.
(b) Annuity.--SAVE UP Accounts shall pay benefits in accordance
with one of the following:
(1) In the case of a participant who does not die before
the annuity starting date, the benefit payable to such
participant shall be provided in the form of a qualified joint
and survivor annuity (as defined in section 205(d)(1) of the
Employee Retirement Income Security Act of 1974 (29 U.S.C.
1055(d)(1))).
(2) In the case of a participant who dies before the
annuity starting date and who has a surviving spouse, a
qualified preretirement survivor annuity (as defined in section
205(d)(2) of the Employee Retirement Income Security Act of
1974 (29 U.S.C. 1055(d)(2))) shall be provided to the surviving
spouse of such participant.
(3) In lieu of a qualified joint and survivor annuity form
of benefit or the qualified preretirement survivor annuity form
of benefit (or both), a participant may elect to receive a
distribution described in subsection (f)(3) if one of the
following conditions are met:
(A)(i) The spouse of the participant consents in
writing to the election.
(ii) Such election designates a beneficiary (or
form of benefits) which may not be changed without
spousal consent (or the consent of the spouse expressly
permits designations by the participant without any
requirement of further consent by the spouse).
(iii) The spouse's consent acknowledges the effect
of such election and is witnessed by a plan
representative or a notary public.
(B) It is established to the satisfaction of a Fund
representative that the consent required under clause
(i) cannot be obtained because there is no spouse,
because the spouse cannot be located, or because of
such other circumstances as the SAVE UP Board of
Governors may by regulations prescribe. The consent of
a spouse (or establishment that the consent of a spouse
cannot be obtained) under this subparagraph shall be
effective only with respect to such spouse.
(c) Commencement of Benefit Payments.--A participant may elect the
time to start receiving benefit payments under this section, except
that a participant--
(1) may not elect to receive benefit payments before
reaching the age of 62; and
(2) must begin receiving benefit payments before the age of
70.
(d) Notice.--Each Fund shall provide to each participant, within a
reasonable period of time before the annuity starting date, a written
explanation substantially similar to that required by section 205(c)(3)
of the Employee Retirement Income Security Act of 1974 (29 U.S.C.
1055(c)(3)).
(e) Assignment or Alienation of Fund Benefits.--Benefits under a
SAVE UP Account shall be subject to section 206(d) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1056(d)).
(f) Methods for Providing Annuitized Benefit Payments.--
(1) In general.--The SAVE UP Board of Trustees shall
establish and maintain mechanisms for adequately securing the
payment of annuity benefits under this section. The SAVE UP
Board of Trustees shall include a written description of such
mechanisms in the investment and lifetime income policy
statements required to be disclosed to participants.
(2) Specific goals.--The mechanisms described in paragraph
(1) shall ensure that--
(A) each participant receives a stream of income
for life;
(B) each participant and beneficiary has an
opportunity to be protected against longevity risk; and
(C) volatility in benefit levels is minimized for
participants and beneficiaries in pay status and those
approaching pay status.
(3) Self-annuitization.--
(A) In general.--Notwithstanding any other
provision of law, a SAVE UP Account may self-annuitize
if the SAVE UP Accounts Fund meets such requirements as
the SAVE UP Board of Governors establishes as necessary
to protect participants and beneficiaries.
(B) Duty to address emerging issues.--The SAVE UP
Board of Governors shall, periodically and in
accordance with established procedures, update the
funding requirements promulgated under this paragraph
in response to changing economic and business
conditions to the extent necessary to carry out the
purposes of this Act.
SEC. 106. SAVE UP ACCOUNTS GOVERNANCE.
(a) SAVE UP Board of Governors.--
(1) Establishment.--There is established in the executive
branch of the Government a SAVE UP Accounts Board of Governors.
(2) Duties.--The Board of Governors shall--
(A) administer the provisions of this title, except
with respect to matters relating to SAVE UP Account
contribution programs maintained by employers pursuant
to section 102 and any duties charged to the SAVE UP
Boards of Trustees;
(B) establish policies for the investment and
management of SAVE UP Account assets, and for the
management and operation of SAVE UP Account annuities
under this title, which shall provide for--
(i) prudent investments suitable for
accumulating funds for payment of retirement
income;
(ii) investment targets;
(iii) sound management practices;
(iv) low administrative costs;
(v) low investment costs; and
(vi) investments in index funds;
(C) review the performance of SAVE UP Account Fund
investments; and
(D) review the management and operation of
annuities.
(3) Composition.--The SAVE UP Board of Governors shall be
composed of--
(A) 5 members, each of whom must be a chairman of a
regional SAVE UP Board of Trustees, and
(B) 6 members appointed by the President, of whom
the President shall appoint at least one resident from
each of the 5 jurisdictions of the regional SAVE UP
Board of Trustees.
(4) Chairman.--The President shall appoint one of such
members as chairman of the SAVE UP Board of Governors. Such
appointment shall be made by and with the advice and consent of
the Senate.
(5) Length of appointments.--Each member appointed by the
President under paragraph (3)(B) shall be appointed for a term
of 6 years, except that of the first such members taking
office--
(A) the chairman member shall serve a term of 7
years,
(B) 1 member shall serve a term of 2 years,
(C) 1 member shall serve a term of 3 years,
(D) 1 member shall serve a term of 4 years,
(E) 1 member shall serve a term of 5 years, and
(F) 1 member shall serve a term of 6 years.
No individual may serve more than 2 terms as a member of the
Board.
(b) Regional SAVE UP Boards of Trustees.--
(1) In general.--There is established in the executive
branch of the Government 5 regional SAVE UP Boards of Trustees,
the jurisdiction of which shall be, to the extent practicable,
apportioned by the Secretary of the Treasury geographically and
to approximate an equal distribution of the United States
population.
(2) Duties.--The SAVE UP Board of Trustees for each region
shall oversee the management and administration of SAVE UP
Accounts of the population within its respective jurisdiction,
including--
(A) with respect to such population, management and
investment of SAVE UP Account Trust Fund assets,
payment of annuities, and compliance with reporting and
disclosure requirements, and
(B) selection of the administrator, attorney,
internal auditor, record keeper, investment consulting
team, and such other staff as may be necessary to carry
out the duties of the SAVE UP Board of Trustees.
Any reference to a SAVE UP Board of Trustees in this title
shall be construed to mean the regional SAVE UP Board of
Trustees with respect to the SAVE UP Accounts within its
jurisdiction, where such construction is necessary to carry out
provisions of this title.
(3) Composition.--Each SAVE UP Board of Trustees shall be
composed of 7 members, of whom--
(A) 2 shall be appointed by the Federal Reserve
Board,
(B) 1 shall be appointed by the Commissioner of the
Securities and Exchange Commission,
(C) 1 shall be appointed by the Speaker of the
House of Representatives,
(D) 1 shall be appointed by the Minority Leader of
the House of Representatives,
(E) 1 shall be appointed by the Majority Leader of
the Senate, and
(F) 1 shall be appointed by the Minority Leader of
the Senate.
(4) Chairman.--For each Board of Trustees, the President
shall designate one of the trustees appointed under paragraph
(3) as chairman, and, in the case of the first such trustees
taking office, shall designate the term of such trustee
pursuant to paragraph (5).
(5) Vice chairman.--Each Board of Trustees shall designate
one of the trustees appointed under paragraph (3) as vice
chairman.
(6) Length of appointments.--
(A) In general.--Each trustee of the Board
appointed under paragraph (3) shall be appointed for a
term of 5 years, except that of the first such trustees
taking office--
(i) the chairman trustee shall be
determined under subparagraph (B),
(ii) 1 trustee shall serve a term of 5
years,
(iii) 1 trustee shall serve a term of 4
years,
(iv) 1 trustee shall serve a term of 3
years,
(v) the vice chairman trustee shall serve a
term of 2 years,
(vi) 1 trustee shall serve for a term of 2
years, and
(vii) 1 trustee shall serve for a term of 1
year.
Other than the chairman and vice chairman trustee, the
terms of the first trustees taking office shall
correspond with the individual who appointed the
trustee under paragraph (3) and shall be ordered from
the longest term to the shortest term on the basis of
the order in which the individuals are listed in such
paragraph.
(B) Chairman terms.--For purposes of subparagraph
(A)(i), of the trustees appointed as chairman of a
Board of Trustees--
(i) 1 chairman shall serve a term of 6
years,
(ii) 2 chairmen shall serve a term of 5
years,
(iii) 1 chairman shall serve a term of 4
years, and
(iv) 1 chairman shall serve a term of 3
years.
(C) Term limits.--No individual may be appointed to
more than 2 terms as a trustee of the SAVE UP Board of
Trustees.
(c) Vacancies.--
(1) In general.--A vacancy on the Boards established under
this section shall be filled in the manner in which the
original appointment was made and shall be subject to any
conditions that applied with respect to the original
appointment.
(2) Completion of term.--An individual chosen to fill a
vacancy under subparagraph (A) shall be appointed for the
unexpired term of the member replaced.
(d) Membership Requirements.--Members and trustees appointed under
this section shall have substantial experience, training, and expertise
in the management of financial investments and pension benefit plans.
(e) Compensation.--
(1) In general.--Each such member or trustee who is not an
officer or employee of the Federal Government shall be
compensated at the daily rate of basic pay for level II of the
Executive Schedule for each day during which such member is
engaged in performing a function of the Board.
(2) Expenses.--Each such member or trustee shall be paid
travel, per diem, and other necessary expenses under subchapter
I of chapter 57 of title 5, United States Code, while traveling
away from such member's home or regular place of business in
the performance of the duties of the Board.
(f) Discharge of Responsibilities.--The members and trustees shall
discharge their responsibilities solely in the interest of the
participants in SAVE UP Accounts and their beneficiaries under this
part.
(g) Annual Independent Audit.--The SAVE UP Board of Governors shall
annually engage an independent qualified public accountant to audit the
activities of the Board of Governors and each Regional Board of
Trustees.
SEC. 107. REPORTING AND DISCLOSURE.
(a) Annual Statement.--The SAVE UP Board of Trustees shall provide
each participant in the Fund an annual statement of--
(1) the estimated amount of the monthly benefit which the
participant or beneficiary is projected to receive from the
Fund, in the form of the default benefit described in the plan
in accordance with the bill;
(2) an explanation, written in a manner calculated to be
understood by the average plan participant, that includes
interest and mortality assumptions used in calculating the
estimate and a statement that actual benefits may be materially
different from such estimate;
(3) a disclosure of SAVE UP Accounts Fund fees and
performance that is substantially similar to the disclosures
required of individual account plans under the Employee
Retirement Income Security Act of 1974;
(4) any other disclosures, including projected benefit
estimates, that the SAVE UP Board of Trustees determines
appropriate; and
(5) such other disclosures as may be required by the Board
of Governors.
(b) Summary Plan Description.--The SAVE UP Board of Trustees shall
provide participants a summary plan description (as described in
section 102 of the Employee Retirement Income Security Act (29 U.S.C.
1022)) as required by section 104(b) of the Employee Retirement Income
Security Act (29 U.S.C. 1024(b)).
(c) Annual Reports.--The SAVE UP Board of Trustees shall file with
the Secretary of Labor periodic reports in accordance with regulations
promulgated by the SAVE UP Board of Governors.
(d) Additional Requirements.--The SAVE UP Board of Trustees shall
be subject to sections 106 and 107 of the Employee Retirement Income
Security Act of 1974 (29 U.S.C. 1026, 1027).
SEC. 108. FIDUCIARY DUTIES UNDER SAVE UP ACCOUNT CONTRIBUTION PROGRAMS
AND SAVE UP ACCOUNTS.
(a) Limitation on Fiduciary Duties Under the SAVE UP Account
Contribution Programs of an Employer.--
(1) Timely payment of contributions.--For purposes of the
Employee Retirement Income Security Act of 1974, the employer's
fiduciary duties under a SAVE UP Account contribution program
established under section 102 shall be limited to those duties
related to the timely payment in full to the individual's SAVE
UP Account of elective contributions made on behalf of
employees as required under section 102(b)(2) and such employer
contributions as may be provided for under the program pursuant
to section 102(b)(3).
(2) Rule of construction.--Nothing in this Act shall be
construed to impose on any employer with respect to any
employee who is a participant in the employer's SAVE UP Account
contribution program any fiduciary duty with respect to the
investment or distribution of assets held under the employee's
SAVE UP Account.
(b) Fiduciary Duties of Board of Governors and Trustees.--For
purposes of the provisions of part 4 of subtitle B of title I of the
Employee Retirement Income Security Act of 1974, and the provisions of
part 5 of such subtitle as they relate to the enforcement of the
provisions of such part 4, each member of the SAVE UP Board of
Governors, each trustee of a SAVE UP Board of Trustees, and any person
who has or exercises discretionary authority or discretionary control
over the management or disposition of the SAVE UP Accounts Fund, and
amounts held to the credit of SAVE UP Accounts, or the crediting of
assets to SAVE UP Accounts, shall be included within the meaning of
``fiduciary'' under section 3(21)(A) of such Act.
SEC. 109. SAVE UP ACCOUNTS DISREGARDED FOR PURPOSES OF MEANS-TESTED
PROGRAMS.
Notwithstanding any other provision of Federal law, any amount
contributed by or on behalf of an individual pursuant to a SAVE UP
Account contribution program, or credited to an individual's SAVE UP
Account under this title, shall not be taken into account in
determining any individual's or household's financial eligibility for,
or amount of, any benefit or service, paid for in whole or in part with
Federal funds.
TITLE II--TAX TREATMENT OF SAVE UP ACCOUNTS
SEC. 201. TAX TREATMENT OF SAVE UP ACCOUNTS.
(a) In General.--Subpart A of part I of subchapter D of chapter 1
of the Internal Revenue Code of 1986 is amended by inserting after
section 408A the following new section:
``SEC. 408B. TAX TREATMENT OF SAVE UP ACCOUNTS.
``(a) In General.--For purposes of this title, except as otherwise
provided in this section--
``(1) the SAVE UP Accounts Fund shall be treated as a trust
described in section 401(a) which is exempt from taxation under
section 501(a) and a SAVE UP Account shall be treated as a
defined contribution plan which includes such a trust,
``(2) any contribution to, or distribution from, the SAVE
UP Accounts Fund under a SAVE UP Account contribution program
shall be treated in the same manner as contributions to or
distributions from such a trust, and
``(3) contributions to a SAVE UP Account under a SAVE UP
Account contribution program shall not be treated as
distributed or made available to the employee or as
contributions made by the employee merely because the employee
has, under such program, an election whether the contribution
will be made to the trust or received by the employee in cash.
``(b) Nondiscrimination Requirements.--A SAVE UP Account
contribution program is not subject to the participation and
nondiscrimination requirements applicable to arrangements described in
section 401(k) or to matching contributions (as described in section
401(m)).
``(c) Rollover From SAVE UP Account Prohibited.--An eligible
rollover distribution (as defined in section 402(c)(4)) shall not
include any amount distributed from a SAVE UP Account.
``(d) SAVE UP Account Loans.--
``(1) Limitations.--Section 72(p)(2)(A) shall only apply
with respect to a SAVE UP Account to the extent that any loan
(when added to the outstanding balance of all other loans from
such plan) does not exceed the lesser of--
``(A) $2,500, or
``(B) the total nonforfeitable amounts credited to
the individual's SAVE UP Account.
``(2) Repayment.--A loan from a SAVE UP Account shall not
fail to be treated as a loan described in section 72(p)(2)(B)
(relating to requirement that loan be repayable in 5 years)
solely because the loan terms allow additional time (not to
exceed an aggregate of 1 year) for repayment to account for any
periods of unemployment.
``(e) Definitions.--For purposes of this section, the terms `SAVE
UP Accounts Fund', `SAVE UP Account', and `SAVE UP Account contribution
program' shall have the respective meanings as when used in title I of
the SAVE UP Act.''.
(b) Limitation on Exclusion for Elective Deferrals.--Paragraph (3)
of section 402(g) of such Code is amended by striking ``and'' at the
end of subparagraph (C), by striking the period at the end of
subparagraph (D) and inserting ``, and'', and by adding at the end the
following new subparagraph:
``(E) any elective employer contribution under a
SAVE UP Account contribution program (as defined in
section 408B).''.
(c) Clerical Amendment.--The table of sections for subpart A of
part I of subchapter D of chapter 1 of such Code is amended by
inserting after the item relating to section 409A the following new
section:
``408C. Tax treatment of SAVE UP Accounts.''.
(d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after the date of the enactment of
this Act.
SEC. 202. SAVE UP ACCOUNT CREDIT.
(a) In General.--Subpart D of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 is amended by adding at the end
the following new section:
``SEC. 45S. SAVE UP ACCOUNT CREDIT.
``(a) In General.--For purposes of section 38, in the case of an
eligible small employer that elects the application of this section,
the SAVE UP Account credit determined under this section for any
taxable year is an amount equal to the lesser of--
``(1) the amount of nonelective employer contributions made
by the employer for the taxable year with respect to employees
under section 102(b)(3) of the Secure, Accessible, Valuable,
Efficient Universal Pension Accounts Act, or
``(2) $10,400.
``(b) Eligible Small Employer.--For purposes of this section, the
term `eligible small employer' means any person the gross receipts of
which for the preceding taxable year did not exceed $5,000,000.
``(c) Limitation.--A taxpayer may elect the application of the
section with respect to not more than 5 taxable years.
``(d) Special Rules.--
``(1) Controlled groups.--All members of the same
controlled group of corporations (within the meaning of section
52(a)) and all persons under common control (within the meaning
of section 52(b)) shall be treated as 1 person for purposes of
this section.
``(2) Disallowance of deduction.--No deduction shall be
allowed for that portion of the nonelective employer
contributions made for the taxable year which is equal to the
credit determined under subsection (a).''.
(b) Credit Made Part of General Business Credit.--Section 38(b) of
such Code is amended by striking ``plus'' at the end of paragraph (35),
by striking the period at the end of paragraph (36) and inserting ``,
plus'', and by adding at the end the following new paragraph:
``(37) the SAVE UP Account credit determined under section
45S(a).''.
(c) Clerical Amendment.--The table of sections for subpart D of
part IV of subchapter A of chapter 1 of such Code is amended by adding
at the end the following new section:
``Sec. 45S. SAVE UP Account credit.''.
(d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2015.
SEC. 203. DISALLOWANCE OF DEDUCTION FOR COMPENSATION FOR CERTAIN
EMPLOYERS FAILING TO PROVIDE SAVE UP ACCOUNT CONTRIBUTION
PROGRAM.
(a) In General.--Section 162 of the Internal Revenue Code of 1986
is amended by redesignating subsection (q) as subsection (r) and by
inserting after subsection (p) the following new subsection:
``(q) Failure To Provide SAVE UP Account Contribution Program.--
``(1) In general.--In the case of an applicable employer
who fails to maintain a SAVE UP Account contribution program
for any calendar year beginning during the taxable year, no
deduction shall be allowed under this chapter for any
remuneration made by the employer for services performed by
employees of the employer.
``(2) Applicable employer.--
``(A) In general.--For purposes of this subsection,
the term `applicable employer' means, with respect to
any calendar year, any employer which is an applicable
employer described in section 101(c)(1)(A) of the
Secure, Accessible, Valuable, Efficient Universal
Pension Accounts Act.
``(B) Aggregation rule.--All persons treated as a
single employer under subsection (a) or (b) of section
52, or subsection (m) or (o) of section 414, of the
Internal Revenue Code of 1986 shall be treated as a
single employer for purposes of this paragraph.
``(3) Waiver.--The Secretary may waive the application of
paragraph (1) with respect to a taxpayer on a showing by the
taxpayer that there was reasonable cause for the failure and
that the taxpayer acted in good faith.''.
(b) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2015.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Ways and Means.
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