NAIFA and other interested parties sent a letter of appreciation to the Senate Finance Committee Chairman Wyden (D-OR) and Ranking Member Mike Crapo (R-ID) for their leadership in releasing the Enhancing American Retirement Now (EARN) Act, which would enhance retirement security for many Americans.
On June 14, the Senate Health, Education, Labor, & Pensions Committee unanimously approved, by voice vote, their ERISA-based portion of SECURE 2.0 (S. 4353, the Retirement Improvement and Savings Enhancement to Supplement Healthy Investments for the Nest Egg (RISE & SHINE) Act. Next up is the Senate Finance Committee, whose portion of SECURE 2.0 focuses on tax-related retirement savings provisions. The Finance Committee will mark up their package on Wednesday, June 22, and has released a section-by-section explanation of their package.
The EARN Act contains 69 provisions (out of some 112 submitted to the committee and/or in Portman/Cardin or in the House-passed Securing a Strong Retirement Act). The package is revenue neutral (per Joint Committee on Tax (JCT) scoring) and it contains three principal revenue raisers, all involving “rothification.” The three revenue raisers are: (1) a requirement that catch-up contributions be Roth contributions, (2) authority for contributions to SEPs and SIMPLE IRA plans to be under Roth rules, and (3) a choice for employees to treat the contributions as their employers make on their behalf under Roth rules (i.e., taxable contributions and after-tax distributions).
This package has bipartisan support and is expected to be approved by the Finance Committee.