The “Retirement Enhancement and Savings Act of 2016,” which the committee passed, “would make some much-needed changes to our nation’s retirement system and address the priorities of a number of our members and their constituents,” according to Committee Chairman Sen. Orrin Hatch, R-Utah.
“As I’ve noted several times before the committee, the most important factor in determining whether workers will save adequately for retirement is their ability to participate in a retirement plan through their employer,” Hatch said. “This legislation will provide a number of options that will expand access to employer-sponsored retirement plans for workers in companies of all sizes.”
Among other things, the bill claims to enhance 401(k) retirement plans and make them more accessible by offering startup and automatic enrollment tax credits for small businesses. It will also make “some common-sense changes” to Individual Retirement Accounts.
Lastly, it claims to increase the portability of 401(k) retirement plans and the “reliability of lifetime income by making it easier for employers to offer annuity contracts.” The bill seeks to provide legal protection from lawsuits for 401(k) plan sponsors when offering annuity products from state-supervised insurance companies.
The Retirement Enhancement and Savings Act of 2016 passed out of committee by a vote of 26 to 0.