[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 2217 Introduced in Senate (IS)]
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119th CONGRESS
1st Session
S. 2217
To amend the Employee Retirement Income Security Act of 1974 and the
Internal Revenue Code of 1986 regarding pension plans for independent
workers, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
July 9, 2025
Mr. Cassidy introduced the following bill; which was read twice and
referred to the Committee on Health, Education, Labor, and Pensions
_______________________________________________________________________
A BILL
To amend the Employee Retirement Income Security Act of 1974 and the
Internal Revenue Code of 1986 regarding pension plans for independent
workers, 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 ``Independent Retirement Fairness
Act''.
SEC. 2. POOLED EMPLOYER PLANS FOR INDEPENDENT WORKERS.
Section 3(43) of the Employee Retirement Income Security Act of
1974 (29 U.S.C. 1002(43)) is amended by adding at the end the
following:
``(E) Treatment of independent workers as
employees.--
``(i) In general.--
``(I) Independent workers.--For
purposes of a pooled employer plan, an
independent worker may be enrolled in
the pooled employer plan as if the
independent worker were an employee of
an employer in the plan and shall be
considered a participant for purposes
of the plan.
``(II) Trade associations.--For
purposes of a pooled employer plan, a
trade association may be in a pooled
employer plan as if the trade
organization were an employer and may
enroll an independent worker in the
plan in accordance with subclause (I).
``(ii) Data harmonization.--For purposes of
an independent worker who is a participant in a
pooled employer plan, an employer of an
independent worker or a trade organization that
enrolls an independent worker may share data
regarding the independent worker with any
person as necessary to facilitate the
establishment and maintenance of the pooled
employer plan.
``(iii) Rule of construction regarding
employment status.--The status of an
independent worker as a participant in a pooled
employer plan of an employer or a trade
association and any contributions made to such
a pooled employer plan by the employer on
behalf of an independent worker shall not be
construed to mean that the independent worker
is an employee of the employer or trade
association in the plan for purposes of any
Federal, State, or local law.
``(iv) Definitions.--For purposes of this
subparagraph:
``(I) Independent worker.--The term
`independent worker' means an
individual who, with respect to an
employer, performs work for
remuneration for the employer and is
not an employee of the employer.
``(II) Trade association.--The term
`trade association' includes any labor
organization, worker cooperative,
employee organization, association of
workers in related or unrelated
industries, or association of related
companies or contractors.''.
SEC. 3. SIMPLIFIED EMPLOYEE PENSIONS FOR INDEPENDENT WORKERS.
(a) In General.--Subsection (k) of section 408 of the Internal
Revenue Code of 1986 is amended by redesignating paragraph (10) as
paragraph (11) and by inserting after paragraph (9) the following new
paragraph:
``(10) Independent workers.--
``(A) In general.--At the election of the employer,
an independent worker may be treated for purposes of
this subsection in the same manner as an employee, as
provided in this paragraph.
``(B) Participation.--In the case of independent
workers--
``(i) Participation.--An employer may elect
to exclude such workers in applying paragraph
(2).
``(ii) Employees electing.--Paragraph
(6)(A)(ii) shall not apply.
``(C) Independent workers treated separately.--For
purposes of applying paragraphs (3)(C), (5), and
(6)(A)(iii), the employer may elect to treat
independent workers separately from employees.
``(D) Not counted in employer size.--Independent
workers shall not be taken into account as employees in
applying paragraph (6)(B).
``(E) Contribution of bonuses.--Notwithstanding
paragraphs (3)(C) and (5), in the case of any
independent worker who is entitled to receive a cash
bonus from the employer, at the election of the
independent worker such bonus may be contributed to the
account or annuity of the worker pursuant to the
simplified employee pension and not paid to the worker
in cash. Any bonus so contributed shall not be taken
into account in determining the percentage of
compensation contributed with respect to the worker.
``(F) Deposits into suspension account.--An account
or annuity shall not fail to be treated as a simplified
employee pension solely because the terms of the
pension allow the employer, at the election of the
independent worker, to deposit contributions into a
suspension account instead of into the account or
annuity, if such contributions are either--
``(i) returned to the independent worker in
cash, or
``(ii) contributed into the account or
annuity pursuant to the terms of the pension,
within the same taxable year or not later than the last
date on which contributions may be made for such
taxable year. Amounts contributed to the account or
annuity pursuant to the preceding sentence shall be
treated for purposes of this subsection as if
contributed directly to such account or annuity, and
amounts returned to the independent worker in cash
shall be treated as never contributed under the
simplified employee pension.
``(G) Definitions.--For purposes of this
paragraph--
``(i) Independent worker.--The term
`independent worker' has the meaning given the
term in section 3(43)(E) of the Employee
Retirement Income Security Act of 1974.
``(ii) Suspension account.--The term
`suspension account' has the meaning given the
term in section 5 of the Independent Retirement
Fairness Act.''.
(b) Effective Date.--The amendment made by this section shall apply
to taxable years beginning after the date of the enactment of this Act.
SEC. 4. SIMPLIFICATION OF AUDITING REQUIREMENTS FOR GROUPS OF PLANS.
Section 202 of the Setting Every Community Up for Retirement
Enhancement Act of 2019 (29 U.S.C. 6058 et seq.) is amended by--
(1) by striking ``relate only'' and inserting the
following:
``(A) relate only''; and
(2) by striking the period and inserting the following: ``;
and
``(B) be based on the same accounting principles
applicable to opinions with respect to pooled employer
plans (as defined in section 3(43) of such Act (29
U.S.C. 1002(43))), except that such an opinion shall
take into account the limitations on the use of the
assets of a plan to pay benefits and expenses only with
respect to such plan and shall take into account that
plans in a group of plans described in subsection (c)
may have separate trusts.''.
SEC. 5. SIMPLIFICATION OF AUDITING FOR POOLED EMPLOYER PLANS.
(a) In General.--Section 3(43) of the Employee Retirement Income
Security Act of 1974 (29 U.S.C. 1002(43)), as amended by section 2 of
this Act, is further amended by adding at the end the following:
``(F) Audit requirement.--Any opinion required by
section 103(a)(3) with respect to a pooled employer
plan shall relate only to the portions of such a plan
attributable to a participating employer for which such
an opinion would be required if the participating
employer maintained such portion as a single-employer
plan separate from the pooled employer plan.''.
(b) Effective Date.--The amendment made by this section shall apply
to plan years beginning after the date of enactment of this Act.
SEC. 6. PILOT PROGRAMS FOR THE GIG ECONOMY.
(a) In General.--The Secretary of the Treasury and the Secretary of
Labor shall, in cooperation and after reviewing a survey of relevant
academic literature and consulting with relevant companies, establish
pilot programs to encourage independent workers to save for retirement,
including--
(1) a program that allows an independent worker to round
down any compensation paid to the independent worker to the
nearest whole dollar amount and automatically contribute the
amount of compensation in excess of such whole dollar amount as
an elective employee contribution to a pooled employer plan in
which the independent worker is enrolled, a solo 401(k) of the
independent worker, or a suspension account; and
(2) a program that allows an independent worker to
designate an amount that will be automatically deducted from
the compensation paid to the independent worker for, as
selected by the independent worker, each pay period or monthly,
quarterly, semi-annually, or annually and automatically
contributed as an elective employee contribution to a pooled
employer plan in which the independent worker is enrolled, a
solo 401(k) of the independent worker, or a suspension account.
(b) Coordination With Safe Harbor Plan Rules.--As provided by the
Secretary of the Treasury (or such Secretary's delegate), the pilot
programs under subsection (a) may be conducted in or through the use of
safe harbor plans, and any such plan participating in such a pilot
program shall not be treated as failing to meet any requirement
applicable to such plan by reason of such participation. For purposes
of the preceding sentence, the term ``safe harbor plan'' means any
qualified cash or deferred arrangement which meets the requirements of
paragraph (11), (12), (13), or (16) of section 401(k) of the Internal
Revenue Code of 1986.
(c) Definitions.--For purposes of this section:
(1) Independent worker.--The term ``independent worker''
has the meaning given the term in section 3(43)(E) of the
Employee Retirement Income Security Act of 1974 (29 U.S.C.
1002(43)(E)).
(2) Pooled employer plan.--The term ``pooled employer
plan'' has the meaning given the term in section 3(43) of the
Employee Retirement Income Security Act of 1974 (29 U.S.C.
1002(43)).
(3) Solo 401(k).--The term ``solo 401(k)'' means a
qualified cash or deferred arrangement (as defined in section
401(k)(2) of the Internal Revenue Code of 1986) covering a
single participant (or a single participant and such
individual's spouse).
(4) Suspension account.--The term ``suspension account''
means an account that is established and maintained on behalf
of an independent worker that--
(A) allows for the deposit of amounts by the
independent worker, including the amounts described in
paragraphs (1) and (2) of subsection (a);
(B) allows for the independent worker to withdraw
amounts deposited in the account and--
(i) contribute such withdrawn amounts to a
pooled employer plan in which the independent
worker is enrolled; or
(ii) contribute such withdrawn amounts into
a simplified employee pension as provided under
section 408(k)(10) of the Internal Revenue Code
of 1986; and
(C) provides that any amount remaining in the
account at the end of each year, after any withdrawals
under subparagraph (B), shall be returned to the
independent worker in a lump sum.
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