[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4672 Introduced in House (IH)]
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117th CONGRESS
1st Session
H. R. 4672
To amend the Internal Revenue Code to allow employers to contribute to
ABLE accounts in lieu of retirement plan contributions.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
July 22, 2021
Mr. Suozzi (for himself and Mr. Wenstrup) introduced the following
bill; which was referred to the Committee on Ways and Means
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code to allow employers to contribute to
ABLE accounts in lieu of retirement plan contributions.
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 ``ABLE Employment Flexibility Act''.
SEC. 2. PROTECTING WORKING ABLE INDIVIDUALS FROM LOSING BENEFITS
BECAUSE OF RETIREMENT PLAN RULES.
(a) In General.--Section 414 of the Internal Revenue Code of 1986
is amended by adding at the end the following new subsection:
``(aa) ABLE Account Contributions.--
``(1) In general.--An applicable employer plan (as defined
in subsection (v)(6)(A)) that is a defined contribution plan
shall not be treated as failing to meet any requirement of this
title solely because the plan provides that an eligible ABLE
individual may elect for a plan year that employer
contributions that would otherwise be made under the terms of
the plan for such plan year shall (in lieu of contribution to
the plan) be contributed by the employer to a qualified ABLE
program described in section 529A on behalf of such eligible
ABLE individual.
``(2) No deduction for amounts contributed to able
account.--Except as provided in paragraph (4), amounts
contributed pursuant to the election under paragraph (1) to a
qualified ABLE program shall not be treated as a contribution
to an applicable employer plan.
``(3) Universal availability.--Paragraph (1) shall not
apply unless the plan provides the election described therein
is available to all eligible ABLE individuals who are eligible
to participate in the plan.
``(4) Application of nondiscrimination rules.--Under rules
prescribed by the Secretary, for purposes of applying sections
401(a)(4), 401(k)(3), 401(k)(12), 401(k)(13), 401(m)(2),
403(b)(12), 408(k)(3), 408(p)(2)(iii), 408(p)(2)(B), 410, and
416, contributions made to a qualified ABLE program pursuant to
the election made described in paragraph (1) shall be treated
as if such contributions were made to the plan.
``(5) Cash or deferred arrangement.--A plan shall not fail
to include a qualified cash or deferred arrangement described
in section 401(k)(1) solely because such plan provides for the
election described in paragraph (1).
``(6) Eligible able individual.--For purposes of this
subsection, the term `eligible ABLE individual' means an
employee who, as of the first day of a plan year, is an
eligible individual within the meaning of section 529A(e)(1)
for the taxable year containing such first day of the plan
year.
``(7) Treatment of permissive withdrawals.--An eligible
ABLE individual may direct that amounts eligible for withdrawal
from an eligible contribution arrangement pursuant to section
414(w) be contributed to a qualified ABLE program described in
section 529A on behalf of such eligible ABLE individual.''.
(b) Treatment as Beneficiary Contribution.--Section 529A(b)(7) of
such Code is amended by redesignating subparagraph (B) as subparagraph
(C) and inserting as subparagraph (B):
``(B) Employer contributions.--Contributions made
to a qualified ABLE program by an employer on behalf of
a designated beneficiary described in this paragraph
pursuant to paragraph (1) or (6) of section 414(a)(a)
shall be treated as made by the designated beneficiary
for purposes of paragraph (2)(B)(ii).''.
(c) Clarification of Availability of Employer Contributions.--
Section 529A(e) of such Code is amended by adding the following
paragraph (7) at the end thereof:
``(7) Employer contributions.--An employer of an eligible
individual may contribute to any qualified ABLE program for
which the eligible individual is the designated beneficiary,
including through a contribution matching a contribution made
by such eligible individual to the qualified ABLE program.''.
(d) Deduction for Contributions Remitted by Employer a Qualified
ABLE Program.--No later than 1 year after enactment, the Secretary of
the Treasury shall--
(1) amend Treasury Regulations under section 162 of such
Code to confirm that contributions made by an employer to a
qualified ABLE program described in section 529A of such Code
on behalf of a eligible ABLE individual described in section
414(aa)(5) of such Code who provides personal services to such
employer shall be considered a reasonable allowance for
salaries or other compensation for personal service if such
contribution for a year, taking into account all other
contributions to such qualified ABLE program does not exceed
the maximum contribution described in section 529A(b)(2)(B) of
such Code; and
(2) update the publications issued for employers to
encourage employers offering a retirement plan with automatic
enrollment to notify employees that elect not to contribute to
the plan and that may be eligible to contribute to a qualified
ABLE program to notify such employee of the possibility of a
contribution under section 529A(b)(2)(B)(ii) of such Code.
(e) Effective Date.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall be effective for plan and
taxable years beginning after enactment.
(2) Clarifications.--Subsections (c) and (d)(1) shall be
effective for plan and taxable years beginning before, on, and
after enactment.
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