Senate Finance Committee Chairman Orrin Hatch (R-UT) and Ranking Member Ron Wyden (D-OR) have introduced an updated version of the Retirement Enhancement and Savings Act (RESA) – a bill to improve access to retirement savings.
- Technical modification to ERISA fiduciary safe harbor for selection of lifetime income provider (section 204): The first sentence of the safe harbor is modified by replacing “selection of an insurer and a guaranteed retirement income contract” with “selection of an insurer for a guaranteed retirement income contract.” This one-word change clarifies that the safe harbor is solely for the selection of the insurer and the possibility that the insurer may not be able to make payments due under the contract.
- Technical modification to benefits of the Tax Court: (1) modifies the survivor annuity benefit to remove deadwood reference to the United States Board of Tax Appeal (section 305 and sec. 7448(n) of the Code); and (2) conforms the legislative language for the deadline by which magistrate judges may elect Tax Court retirement benefits to the committee report for S. 3471 (section 307 and sec. 7448(b) of the Code).
- Provisions deleted because of prior enactment: (1) extended rollover period for plan loan offsets (section 110 of S. 3471; enacted as part of Public Law 115-97); (2) modification of hardship withdrawal rules from 401(k) plans (section 111 of S. 3471; enacted as part of the Bipartisan Budget Act of 2018); (3) tax treatment of qualified equity grants (section 402 of S. 3471; enacted as part of Public Law 115-97); and (4) repeal of partnership technical terminations (section 506 of S. 3471; enacted as part of Public Law 115-97).
- Modification of effective dates: RESA as originally introduced was generally effective for years beginning after December 31, 2016; these effective dates have been changed to years beginning after December 31, 2018. Additionally, the acceleration of PBGC premiums in section 506 has been modified by accelerating additional months of premiums.
A section-by-section overview of the 2018 RESA is available here.