NAIFA supports the bipartisan Retirement Simplification and Clarity Act reintroduced by Reps. Jimmy Panetta (D-Calif.) and Darin LaHood (R-Ill.), which would require the IRS to rewrite documentation that employers must provide exiting employees who request distributions from their 401(k) plans. The new notice would use “clear, straightforward language” to explain various options for 401(k) distributions and rollovers along with their tax implications. The bill would also allow people aged 50 and over to roll over employer-sponsored 401(k) accounts into annuities.
The proposal is designed to give Americans a better understanding of their retirement plan options when they leave a job as well as more flexibility to include lifetime guaranteed income products in their retirement plans.
Rep. Panetta’s press release on the legislation quotes NAIFA CEO Kevin Mayeux, CAE, as saying: “NAIFA is pleased to endorse the Retirement Simplification and Clarity Act, introduced by Rep. Panetta (D-CA) and Rep. LaHood (R-IL). As the largest national association of insurance and financial advisers with members assisting hard-working, everyday Americans in all states and Congressional districts with retirement savings choices, we applaud any effort to simplify the rules for retirement savings and to enhance the ability of retirees to ensure they do not outlive their savings through guaranteed income options. This bill will advance those worthy goals, and NAIFA looks forward to working with the sponsors to see it enacted.”