Expanding Access to Retirement Savings for Caregivers Act
This bill allows an individual to make annual catch up contributions to a retirement account before reaching age 50 if the individual leaves the workforce to provide dependent cares services.
Specifically, the individual must have been unemployed, and have had no earned income, as a result of providing care to (1) a dependent under the age of 13, or (2) a spouse physically or mentally incapable of self-care.
[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3644 Introduced in House (IH)]
<DOC>
117th CONGRESS
1st Session
H. R. 3644
To amend the Internal Revenue Code of 1986 to reduce the age for making
catch-up contributions to retirement accounts to take into account time
out of the workforce to provide dependent care services.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
May 28, 2021
Mrs. Walorski (for herself and Mr. Pappas) introduced the following
bill; which was referred to the Committee on Ways and Means
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to reduce the age for making
catch-up contributions to retirement accounts to take into account time
out of the workforce to provide dependent care services.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Expanding Access to Retirement
Savings for Caregivers Act''.
SEC. 2. REDUCTION OF AGE FOR MAKING CATCH-UP CONTRIBUTIONS FOR
INDIVIDUALS OUT OF WORKFORCE TO PROVIDE DEPENDENT CARE
SERVICES.
(a) Individual Retirement Plans.--Section 219(b)(5) of the Internal
Revenue Code of 1986 is amended by adding at the end the following new
subparagraph:
``(D) Reduction of age for making catch-up
contributions for individuals out of workforce to
provide dependent care services.--
``(i) In general.--In the case of an
eligible individual, subparagraph (B)(i) shall
be applied by substituting `the applicable age
with respect to such individual' for `the age
of 50'.
``(ii) Applicable age.--For purposes of
this subparagraph, the term `applicable age'
means, with respect to any eligible individual
for any taxable year, 50 reduced by the number
of years which is equal to the duration of the
aggregate qualified unemployment periods with
respect to such individual (determined as of
the beginning of such taxable year). For
purposes of the preceding sentence any duration
of aggregate qualified unemployment periods
which is not a multiple of a whole number of
years shall be rounded to the next lowest whole
number of years.
``(iii) Eligible individual.--For purposes
of this subparagraph, the term `eligible
individual' means, with respect to any taxable
year, any individual who has one or more
qualified unemployment periods determined as of
the beginning of such taxable year.
``(iv) Qualified unemployment period.--For
purposes of this subparagraph, the term
`qualified unemployment period' means, with
respect to any individual, any uninterrupted
period--
``(I) which is not less than 1
year,
``(II) which begins after such
individual attains age 18, and
``(III) during which such
individual has no earned income (as
defined in section 32(c)(2)) on account
of such individual's provision of care
to one or more qualifying individuals
(as defined in section 21(b)(1)).
``(v) Declaration requirement.--A qualified
unemployment period shall not be taken into
account under this subparagraph with respect to
any individual unless such individual has
submitted to the Secretary a written
declaration made under the penalties of perjury
that such period meets the requirements of
clause (iv) with respect to such individual.
The trustee may rely on such declaration unless
the trustee knows, or has reason to know, that
such declaration is false.''.
(b) Elective Deferrals.--Section 414(v) of such Code is amended by
adding at the end the following new paragraph:
``(7) Reduction of age for making catch-up contributions
for individuals out of workforce to provide dependent care
services.--
``(A) In general.--In the case of an eligible
participant, paragraph (5)(A) shall be applied by
substituting `the applicable age with respect to such
participant' for `age 50'.
``(B) Application of definitions and rules.--For
purposes of this paragraph, clauses (ii), (iii), (iv),
and (v) of section 219(b)(5)(D) shall apply--
``(i) by substituting `participant' for
`individual' each place it appears in such
clauses, and
``(ii) by substituting `plan administrator'
for `trustee' in such clause (v).
``(C) Error correction.--The Secretary shall issue
regulations or other guidance under which an applicable
employer plan may correct for an impermissible catch-up
contribution by providing for a distribution of such
contribution together with any earnings properly
attributable thereto.''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after the date of the enactment of
this Act.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Ways and Means.
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