[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5832 Introduced in House (IH)]
<DOC>
117th CONGRESS
1st Session
H. R. 5832
To establish the Retirement Savings Lost and Found, and for other
purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
November 3, 2021
Ms. Bonamici introduced the following bill; which was referred to the
Committee on Ways and Means, and in addition to the Committee on
Education and Labor, for a period to be subsequently determined by the
Speaker, in each case for consideration of such provisions as fall
within the jurisdiction of the committee concerned
_______________________________________________________________________
A BILL
To establish the Retirement Savings Lost and Found, 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.
This Act may be cited as the ``Retirement Savings Lost and Found
Act of 2021''.
SEC. 2. RETIREMENT SAVINGS LOST AND FOUND.
(a) In General.--
(1) Establishment of retirement savings lost and found.--
Subtitle C of title IV of the Employee Retirement Income
Security Act of 1974 (29 U.S.C. 1341 et seq.) is amended by
adding at the end the following:
``SEC. 4051. RETIREMENT SAVINGS LOST AND FOUND.
``(a) Establishment.--
``(1) In general.--Not later than 3 years after the date of
the enactment of this section, the Secretary, in consultation
with the Secretary of the Treasury, shall establish an online
searchable database (to be managed by the Secretary in
accordance with this section) to be known as the `Retirement
Savings Lost and Found'. The Retirement Savings Lost and Found
shall--
``(A) allow an individual to search for information
that enables the individual to locate the administrator
of any plan described in paragraph (2) with respect to
which the individual is or was a participant or
beneficiary, and to provide contact information for the
administrator of any such plan;
``(B) allow the Secretary to assist such an
individual in locating any such plan of the individual;
and
``(C) allow the Secretary to make any necessary
changes to contact information on record for the
administrator based on any changes to the plan due to
merger or consolidation of the plan with any other
plan, division of the plan into two or more plans,
bankruptcy, termination, change in name of the plan,
change in name or address of the administrator, or
other causes.
The Retirement Savings Lost and Found established under this
paragraph shall include information reported under this section
and other relevant information obtained by the Secretary.
``(2) Plans described.--A plan described in this paragraph
is a plan to which the vesting standards of section 203 apply.
``(b) Administration.--The Retirement Savings Lost and Found
established under subsection (a) shall provide individuals described in
subsection (a)(1) only with the ability to view contact information for
the administrator of any plan with respect to which the individual is
or was a participant or beneficiary, sufficient to allow the individual
to locate the individual's plan in order to recover any benefit owing
to the individual under the plan.
``(c) Safeguarding Participant Privacy and Security.--In
establishing the Retirement Savings Lost and Found under subsection
(a), the Secretary shall take all necessary and proper precautions to
ensure that individuals' plan information maintained by the Retirement
Savings Lost and Found is protected and that persons other than the
individual cannot fraudulently claim the benefits to which any
individual is entitled.
``(d) Definitions.--For purposes of this section and section 4052--
``(1) the term `administrator' has the meaning given such
term in section 3(16)(A); and
``(2) the term `Secretary' means the Secretary of Labor.
``SEC. 4052. OFFICE OF THE RETIREMENT SAVINGS LOST AND FOUND.
``(a) Establishment; Responsibilities of Office.--
``(1) In general.--Not later than 2 years after the date of
the enactment of this section, the Secretary, in consultation
with the Secretary of the Treasury, shall establish within the
Department of Labor an Office of the Retirement Savings Lost
and Found (in this section referred to as the `Office').
``(2) Responsibilities of office.--The Office shall--
``(A) carry out subsection (b) of this section; and
``(B) maintain the Retirement Savings Lost and
Found established under section 4051.
``(b) Certain Non-Responsive Participants Entitled to Small
Benefits.--
``(1) General rule.--
``(A) Transfer to the office of the retirement
savings lost and found.--The administrator of a plan
that is not terminated and to which section
401(a)(31)(B) of the Internal Revenue Code of 1986
applies may transfer to the Office the amount allowed
to be transferred under section 401(a)(31)(B)(iv) of
such Code for a non-responsive participant (after the
requirements of section 401(a)(31)(B)(iii) are met).
``(B) Information and payment to the office.--Upon
making a transfer under subparagraph (A), the
administrator shall provide to the Office such
information and certifications as the Office shall
specify, including with respect to the transferred
amount and the non-responsive participant, within such
time and in such manner as may be specified by the
Office.
``(C) Information requirements after transfer.--
``(i) In general.--In the event that, after
a transfer is made under subparagraph (A), the
relevant non-responsive participant contacts
the administrator, the administrator shall
notify and provide such information to the non-
responsive participant, within such time and in
such manner, as the Office shall specify.
``(ii) Civil penalty.--The Secretary may
assess a civil penalty against the
administrator of a plan of up to $100 a day
from the date of the administrator's failure or
refusal to provide notice and required
information to a non-responsive participant in
accordance with clause (i).
``(D) Search and payment by the office following
transfer.--Upon receiving information described in
subparagraph (C), the Office shall attempt to contact
(including conducting a search for) the non-responsive
participant for whom the Office has received a transfer
under subparagraph (A). Upon location of a non-
responsive participant who claims benefits, the Office
shall make a single payment to the non-responsive
participant in an amount equal to the sum of--
``(i) the amount transferred to the Office
under subparagraph (A) for such participant;
and
``(ii) interest, determined in the same
manner as for purposes of section 4050.
The Office shall take all reasonable steps to assist
the participant to roll over the payment made under
this paragraph to an eligible retirement plan (as
defined in section 402(c)(8) of the Internal Revenue
Code of 1986) in a manner that ensures that such
payment will not be includible in the gross income of
the participant for the taxable year in which paid.
``(2) Definition.--For purposes of this subsection, the
term `non-responsive participant' means--
``(A) a participant or beneficiary of a plan
described in paragraph (1)(A)--
``(i) who is entitled to a benefit subject
to a transfer under section 401(a)(31)(B)(iii)
of the Internal Revenue Code of 1986; and
``(ii) for whom the plan has satisfied the
conditions in such section and section
401(a)(31)(B)(iv) of such Code, and any
requirements relating to the location of
missing participants established by the
Secretary pursuant to title I of this Act; and
``(B) any other participant or beneficiary
determined to be lost or missing under regulations to
be issued by the Secretary, in consultation with the
Secretary of the Treasury.
``(3) Regulatory authority.--The Secretary shall prescribe
such regulations as are necessary to carry out the purposes of
this section.
``(c) Information Collection.--The administrator of a plan to which
the vesting standards of section 203 apply shall submit to the Office,
at such time and in such form and manner as is prescribed in
regulations--
``(1) the information described in paragraphs (1) through
(4) of section 6057(b) of the Internal Revenue Code of 1986;
``(2) the information described in subparagraphs (A), (B),
(E), and (F) of section 6057(a)(2) of the Internal Revenue Code
of 1986; and
``(3) such other information as the Secretary may require.
``(d) Program Integrity Audit.--On an annual basis for each of the
first 5 years beginning after the date of enactment of this section and
every 5 years thereafter, the Inspector General of the Department of
Labor shall conduct an audit of the administration of the Retirement
Savings Lost and Found by the Office, including an assessment of fraud
relating to claims of benefits.
``(e) Application of State Escheat Laws.--No State law relating to
the disposition of unclaimed or abandoned property under which a
benefit amount under a plan to which this section applies would escheat
to a State or otherwise become the property of a State under such a law
shall apply with respect to any such benefit amount for any period
beginning on or after the date of enactment of this section.
``(f) Effective Date.--The requirements of subsections (b), (c),
and (d) shall apply with respect to plan years beginning after the
second December 31 occurring after the date of the enactment of this
section.
``(g) Authorization of Appropriations.--There are authorized to be
appropriated such sums as may be necessary to carry out this
section.''.
(2) Conforming amendment.--The table of contents for the
Employee Retirement Income Security Act of 1974 (29 U.S.C. 1001
et seq.) is amended by inserting after the matter relating to
section 4050 the following:
``Sec. 4051. Retirement Savings Lost and Found.
``Sec. 4052. Office of the Retirement Savings Lost and Found.''.
(b) Mandatory Transfers of Rollover Distributions.--
(1) Investment options.--
(A) In general.--Subparagraph (B) of section
404(c)(3) of the Employee Retirement Income Security
Act of 1974 (29 U.S.C. 1104(c)(3)) is amended by
striking the period at the end and inserting ``, and,
to the extent the Secretary of Labor provides in
guidance or regulations issued after the enactment of
this Act, is made to--
``(i) a target date or life cycle fund held
under such account;
``(ii) as described in section 2550.404a-2
of title 29, Code of Federal Regulations, an
investment product held under such account
designed to preserve principal and provide a
reasonable rate of return;
``(iii) the Office of the Retirement
Savings Lost and Found in accordance with
section 401(a)(31)(B)(iv) of the Internal
Revenue Code of 1986 and section 4052(b)(1)(A);
or
``(iv) such other option as the Secretary
of Labor may so provide.''.
(B) Regulations.--Not later than 1 year after the
date of the enactment of this Act, the Secretary of
Labor shall promulgate regulations identifying the
target date or life cycle funds, or specifying the
characteristics of such a fund, that will be deemed to
meet the requirements of section 404(c)(3)(B)(i) of the
Employee Retirement Income Security Act of 1974 (29
U.S.C. 1104(c)(3)(B)), as amended by subparagraph (A).
(2) Expansion of cap; authority to transfer lesser
amounts.--
(A) Cap.--Sections 401(a)(31)(B)(ii) and
411(a)(11)(A) of the Internal Revenue Code of 1986 and
section 203(e)(1) of the Employee Retirement Income
Security Act of 1974 are each amended by striking
``$5,000'' and inserting ``$6,000''.
(B) Distribution of larger amounts to individual
retirement plans only.--Section 401(a)(31)(B)(i) of
such Code is amended by adding at the end the
following: ``The Office of the Retirement Savings Lost
and Found established by section 4051 of the Employee
Retirement Income Security Act of 1974 shall not be
treated as a trustee or issuer that is eligible to
receive such distributions.''.
(C) Lesser amounts.--
(i) Amendment of internal revenue code of
1986.--Section 401(a)(31)(B) of such Code is
amended by adding at the end the following new
clauses:
``(iii) Treatment of lesser amounts.--In
the case of a trust which is part of an
eligible plan (as defined in clause (ii)) to
which the vesting standards of section 203 of
the Employee Retirement Income Security Act of
1974 apply, such trust shall not be a qualified
trust under this section unless such plan
provides that, if a participant in the plan
separates from the service covered by the plan
and the nonforfeitable accrued benefit
described in clause (ii) is not in excess of
$1,000 (including in any case in which payment
of such a benefit is attempted but not accepted
by the participant or beneficiary within 6
months of such payment attempt)--
``(I) the plan administrator may,
after conducting a diligent search as
provided in clause (vi) and notifying
the participant (either separately or
as part of the notice under section
402(f) of such Code) that the
participant is entitled to such
benefit, or attempting to pay the
benefit directly to the participant,
transfer such amount to the Office in
accordance with clause (iv); and
``(II) the plan administrator shall
not charge against the benefit any
administrative or other fee for such
transfer.
``(iv) Transfers to retirement savings lost
and found.--If, after a plan administrator
takes the actions required under clause
(iii)(I), the participant does not--
``(I) not later than 3 years after
the notification under such paragraph,
make an election under subparagraph (A)
or elect to receive a distribution of
the benefit directly, or
``(II) accept any payment made
under such clause within 3 years of the
attempted payment,
the plan administrator may transfer the amount
of such benefit to the Office of the Retirement
Savings Lost and Found in accordance with
section 4052(b) of the Employee Retirement
Income Security Act of 1974.
``(v) Income tax treatment of transfers to
and distributions from retirement savings lost
and found.--For purposes of determining the
income tax treatment of transfers to the Office
of the Retirement Savings Lost and Found under
clause (iv) or of transfers to an employee
benefit plan or individual retirement account--
``(I) such a transfer shall be
treated as a transfer to an individual
retirement plan under clause (i); and
``(II) the distribution of such
amounts by the Office of the Retirement
Savings Lost and Found shall be treated
as a distribution in accordance with
section 4050(a) of the Employee
Retirement Income Security Act of 1974
from an individual retirement plan.
``(vi) Diligent search.--For purposes of
clause (iii), a diligent search requires taking
all of the following steps, consistent with
guidance issued by the Secretary of Labor, in
consultation with the Secretary of the
Treasury, not later than 18 months after the
date of enactment of this clause:
``(I) A search for alternate
contact information (address,
telephone, or email) in the possession
of the plan, any related plan, or the
plan sponsor.
``(II) Use of free online search
engines, public record databases,
publicly available directories, or
obituaries.
``(III) Use of a commercial locator
service, a credit reporting agency or a
proprietary internet search tool for
locating individuals.
``(IV) The mailing of a contact
letter sent by United States Postal
Service via certified mail to the last
known address and to any other
alternate address found.''.
(ii) Amendment of employee retirement
income security act of 1974.--Section 404 of
the Employee Retirement Income Security Act of
1974 (29 U.S.C. 1104) is amended by adding at
the end the following new subsection:
``(f) Safe Harbor With Respect to Transferring Account Balance of
Missing Participants.--
``(1) In general.--With respect to the transfer
requirements of section 401(a)(31)(B) of the Internal Revenue
Code of 1986, the requirements of subsection (a)(1)(B) with
respect to the administrator will be deemed to be satisfied in
the case of a participant--
``(A) who separates from the service covered by the
plan, and
``(B) the nonforfeitable accrued benefit of whom
(as described in section 401(a)(31)(B)(ii) of such
Code) is not in excess of $1,000,
if the administrator adopts practices and procedures with
respect to maintaining up-to-date contact information on
participants and fulfills the requirements of paragraphs (2),
(3), and (4).
``(2) Notification.--The requirements of this paragraph are
satisfied if the administrator conducts a diligent search as
provided in paragraph (4) and notifies the participant (either
separately or as part of the notice under section 402(f) of
such Code) that the participant is entitled to such benefit, or
attempts to pay the benefit directly to the participant.
``(3) Transfers to retirement savings lost and found.--If,
after an administrator takes the actions required under
paragraph (2), the participant does not--
``(A) not later than 3 years after the notification
under such paragraph, make an election under section
401(a)(31)(A) of such Code or elect to receive a
distribution of the benefit directly, or
``(B) accept any payment made under such paragraph
within 3 years of the attempted payment,
the administrator may transfer the amount of such benefit to
the Office of the Retirement Savings Lost and Found in
accordance with section 4052(b).
``(4) Diligent search.--For purposes of paragraph (2), a
diligent search requires taking all of the following steps,
consistent with guidance issued by the Secretary of Labor, in
consultation with the Secretary of the Treasury, not later than
18 months after the date of enactment of this clause:
``(A) A search for alternate contact information
(address, telephone, or email) in the possession of the
plan, any related plan, or the plan sponsor.
``(B) Use of free online search engines, public
record databases, publicly available directories, or
obituaries.
``(C) Use of a commercial locator service, a credit
reporting agency or a proprietary internet search tool
for locating individuals.
``(D) The mailing of a contact letter sent by
United States Postal Service via certified mail to the
last known address and to any other alternate address
found.
An administrator of a plan that takes all of the steps
described in the preceding subparagraphs and that adopts
practices and procedures with respect to maintaining up-to-date
contact information on participants shall be deemed to meet its
fiduciary duty under section 404 with respect to locating a
non-responsive participant (as defined in section
4052(b)(2)).''.
(D) Effective date.--The amendments made by this
paragraph shall apply to vested benefits with respect
to participants who separate from service connected to
the plan in plan years beginning 1 year after the
finalization of the regulations issued pursuant to
section 4052(b)(2).
(c) Better Reporting for Mandatory Transfers.--
(1) In general.--Paragraph (2) of section 6057(a) of the
Internal Revenue Code of 1986 is amended--
(A) in subparagraph (C)--
(i) by striking ``during such plan year''
in clause (i) and inserting ``during the plan
year immediately preceding such plan year'';
(ii) by adding ``and'' at the end of clause
(i); and
(iii) by striking clause (iii);
(B) by redesignating subparagraph (E) as
subparagraph (G);
(C) by striking ``and'' at the end of subparagraph
(D); and
(D) by inserting after subparagraph (D) the
following new subparagraphs:
``(E) the name and taxpayer identifying number of
each participant or former participant in the plan--
``(i) who, during the current plan year or
any previous plan year, was reported under
subparagraph (C), and with respect to whom the
benefits described in subparagraph (C)(ii) were
fully paid during the plan year,
``(ii) with respect to whom any amount was
distributed under section 401(a)(31)(B) during
the plan year, or
``(iii) with respect to whom a deferred
annuity contract was distributed during the
plan year,
``(F) in the case of a participant or former
participant to whom subparagraph (E) applies (and to
the extent provided in regulations designed to protect
privacy to be issued by the Secretary of Labor)--
``(i) in the case of a participant
described in clause (ii) thereof, the name and
address of the designated trustee or issuer
described in section 401(a)(31)(B)(i) and the
account number of the individual retirement
plan to which the amount was distributed, and
``(ii) in the case of a participant
described in clause (iii) thereof, the name and
address of the issuer of such annuity contract
and the contract or certificate number, and''.
(2) Rules relating to direct trustee-to-trustee
transfers.--
(A) In general.--Paragraph (6) of section 402(e) of
such Code is amended--
(i) by striking ``transfers.--Any'' and
inserting ``transfers.--
``(A) In general.--Any''; and
(ii) by adding at the end the following new
subparagraph:
``(B) Notification of trustee.--In the case of a
distribution under section 401(a)(31)(B), the
administrator shall notify the designated trustee or
issuer described in clause (i) thereof that the
transfer is a mandatory distribution required by such
section.''.
(B) Penalty.--Subsection (i) of section 6652 of
such Code is amended--
(i) by striking ``to Recipients'' in the
heading and inserting ``or Notification'';
(ii) by striking ``402(f),'' and inserting
``402(f) or a notification as required by
section 402(e)(6)(B),''; and
(iii) by striking ``such written
explanation'' and inserting ``such written
explanation or notification''.
(C) Reports.--Subsection (i) of section 408 of such
Code is amended--
(i) by redesignating subparagraphs (A) and
(B) of paragraph (2) as clauses (i) and (ii),
respectively, and by moving such clauses 2 ems
to the right;
(ii) by redesignating paragraphs (1) and
(2) as subparagraphs (A) and (B), respectively,
and by moving such subparagraphs 2 ems to the
right;
(iii) by striking ``as the Secretary
prescribes'' in subparagraph (B)(ii), as so
redesignated, and all that follows through ``a
simple retirement account'' and inserting ``as
the Secretary prescribes''.
``(3) Simple retirement accounts.--In the case of a simple
retirement account'';
(iv) by striking ``Reports.--The trustee
of'' and inserting ``Reports.--
``(1) In general.--The trustee of'';
(v) by striking ``under paragraph (2)'' in
paragraph (3), as redesignated by clause (iii),
and inserting ``under paragraph (1)(B)''; and
(vi) by inserting after paragraph
(1)(B)(ii), as redesignated by the preceding
clauses, the following new paragraph:
``(2) Mandatory distributions.--In the case of an account,
contract, or annuity to which a transfer under section
401(a)(31)(B) is made (including a transfer from the individual
retirement plan to which the original transfer under such
section was made to another individual retirement plan), the
report required by this subsection for the year of the transfer
and any year in which the information previously reported in
subparagraph (B) changes shall--
``(A) identify such transfer as a mandatory
distribution required by such section,
``(B) include the name, address, and taxpayer
identifying number of the trustee or issuer of the
individual retirement plan to which the amount is
transferred, and
``(C) be filed with the Secretary of Labor.''.
(3) Notification of participants upon separation.--
Subsection (e) of section 6057 of such Code is amended by
inserting ``, and, with respect to any benefit of the
individual subject to section 401(a)(31)(B), a notice of
availability of, and the contact information for, the
Retirement Savings Lost and Found established under section
4051 of the Employee Retirement Income Security Act of 1974''
before the period at the end of the second sentence.
(4) Effective date.--The amendments made by this paragraph
shall apply to distributions made in, and returns and reports
relating to, years beginning after the second December 31
occurring after the date of the enactment of this Act.
(d) Requirement of Electronic Filing.--
(1) In general.--Paragraph (2) of section 6011(e) of the
Internal Revenue Code of 1986 is amended--
(A) by redesignating subparagraphs (A) and (B) as
clauses (i) and (ii), respectively, and by moving such
clauses 2 ems to the right;
(B) by striking ``Regulations.--In prescribing''
and inserting ``Regulations.--
``(A) In general.--In prescribing''; and
(C) by adding at the end the following new
subparagraph:
``(C) Exceptions.--Notwithstanding subparagraph
(A), the Secretary shall require returns or reports
required under--
``(i) sections 6057, 6058, and 6059, and
``(ii) sections 408(i), 6041, and 6047 to
the extent such return or report relates to the
tax treatment of a distribution from a plan,
account, contract, or annuity,
to be filed on magnetic media, but only with respect to
persons who are required to file at least 50 returns
during the calendar year which includes the first day
of the plan year to which such returns or reports
relate.''.
(2) Effective date.--The amendments made by this paragraph
shall apply to returns and reports relating to years beginning
after the second December 31 occurring after the date of the
enactment of this Act.
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