House Ways and Means Committee Ranking Member Richard E. Neal (D-MA) today reintroduced the Automatic IRA Act, which would expand retirement coverage for millions of workers by requiring businesses with 10 or more employees to offer a workplace retirement plan.
The legislation, which Neal also introduced in Feb. 2024, unlocks a key retirement savings vehicle for employees, gig workers, and other independent contractors nationwide.
“Automatic IRAs are simple and effective, and they have proven to be a successful tool to unlock secure retirements for more workers,” Neal said in a Dec. 15 press release. “Across the country, many state automatic IRAs are demonstrating that they work not only in increasing savings rates but also to help close racial, gender, and income savings gaps. It’s past time for us to expand this opportunity to all Americans, and with the Automatic IRA Act of 2025, we can once again show that meaningful retirement legislation is possible in the Ways and Means Committee and in this Congress.”
“Automatic IRAs are simple and effective, and they have proven to be a successful tool to unlock secure retirements for more workers.”
Neal first introduced the Automatic IRA Act in the 109th Congress, and has remained steadfast in his commitment to securing the American people’s retirement savings. As of August 2025, one million workers have saved $2 billion in state automatic IRA programs, according to research from the Pew Charitable Trusts.
The bill generally would require employers with more than 10 employees that do not sponsor a retirement plan to automatically enroll their employees in IRAs (automatic IRAs) or other automatic contribution plans like 401(k)s. Workers would also have the flexibility to opt out at any time.
Smaller employers would be eligible for a new auto IRA tax credit, making this requirement essentially costless to implement. In general, the legislation would apply to plan years beginning after 2027. The new tax credit for small employer automatic IRAs would apply to tax years beginning after 2025.
Additionally, the bill includes provisions to help workers convert their savings into a guaranteed income. Employers would be required to offer employees with at least $200,000 in vested savings the option to convert up to half their balance into a protected lifetime income solution, such as an annuity.
“Far too many workers are left without the ability to save through their job, and this bill offers a smart, practical solution to close that gap,” said Wayne Chopus, President and CEO of the Insured Retirement Institute (IRI), in a press release today. “By expanding access and strengthening savings tools, Congressman Neal’s legislation will help workers and retirees achieve a secure and dignified retirement.”
Currently, nearly half of U.S. workers lack access to a retirement savings plan through their employer. Of these, about two-thirds work at businesses with 10 or more employees. The lack of coverage disproportionately impacts workers of color: nearly two-thirds of Latino workers, more than half of Black workers, and nearly half of Asian workers do not have a workplace retirement plan.
A study of the impact of such a new law on workers’ retirement security found that $7 trillion in additionalretirement savings would be generated, and 62 million new retirement savers would be created over 10 years. Ninety-eight percent of new savers would earn less than $100,000 annually, including 7 million new Black savers and 10.8 million new Latino savers.
The legislation also recognizes the growing role of non-traditional, or “gig” work. It directs the Treasury Secretary to, by regulation or other guidance, provide for making available automatic IRAs to individuals who provide services to the employer that do not constitute employment.
IRI’s press release noted that the Automatic IRA Act of 2025 builds on bipartisan progress made through the SECURE Act of 2019 and the SECURE 2.0 Act, which created new pathways for small businesses to provide their employees with a workplace retirement savings plan.
Those laws created pooled employer plans (PEPs), authorized and expanded tax incentives to cover costs of starting a plan, and reduced administrative barriers to offering protected, guaranteed lifetime income solutions in retirement plans.
These policies provide employers with practical tools that simplify compliance with the new coverage requirements established by the Automatic IRA Act of 2025, while offering more employees meaningful opportunities to save.
Neal first announced he would be reintroducing the bill during an appearance at TIAA’s FUTUREWISE event, and TIAA released a letter of support for the bill on Dec. 12.
“Your transformative legislation would automatically create federal IRAs for workers without other access to retirement plans—the first, essential step to securing every worker’s right to a secure, dignified retirement,” wrote TIAA President and CEO Thasunda Brown Duckett. “It builds on proven policy solutions: 20 states have enacted state-facilitated retirement programs for private-sector employees. A federal program would help ensure workers’ pathway to retirement security no longer depends on their employer or state.”
Duckett added that the bill would provide savers with critical access to lifetime income options designed to provide a paycheck throughout retirement, helping reduce the risk retirees will outlive their savings.
A summary of the bill can be found HERE.
Full text of the Automatic IRA Act of 2025 is available HERE.
SEE ALSO:
• ‘Automatic IRA Act of 2024’ Enthusiastically Welcomed by Retirement Industry
• 2027 Saver’s Match Could Supercharge Auto-IRA Participation