H.R. 3078 - Expanding Access to Retirement Savings for Caregivers Act

116TH CONGRESS
1ST SESSION

H.R. 3078

To amend the Internal Revenue Code of 1986 to reduce
the age for making catch-up contributions to retirement accounts
to take into account time out of the workforce
to provide dependent care services.

IN THE HOUSE OF REPRESENTATIVES

JUNE 4, 2019

Mr. ROUDA (for himself and Mrs. WALORSKI) introduced the following bill;
which was referred to the Committee on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to reduce the age for making catch-up contributions to retirement accounts to take into account time out of the workforce to provide dependent care services.

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 "Expanding Access to Retirement Savings for Caregivers Act".

SEC. 2. REDUCTION OF AGE FOR MAKING CATCH-UP CONTRIBUTIONS FOR INDIVIDUALS OUT OF WORKFORCE TO PROVIDE DEPENDENT CARE SERVICES.

(a) INDIVIDUAL RETIREMENT PLANS. — Section 219(b)(5) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph:

"(D) REDUCTION OF AGE FOR MAKING CATCH-UP CONTRIBUTIONS FOR INDIVIDUALS OUT OF WORKFORCE TO PROVIDE DEPENDENT CARE SERVICES. —

"(i) IN GENERAL. — In the case of an eligible individual, subparagraph (B)(i) shall be applied by substituting 'the applicable age with respect to such individual' for 'the age of 50'.

"(ii) APPLICABLE AGE. — For purposes of this subparagraph, the term 'applicable age' means, with respect to any eligible individual for any taxable year, 50 reduced by the number of years which is equal to the duration of the aggregate qualified unemployment periods with respect to such individual (determined as of the beginning of such taxable year). For purposes of the preceding sentence any duration of aggregate qualified unemployment periods which is not a multiple of a whole number of years shall be rounded to the next lowest whole number of years.

"(iii) ELIGIBLE INDIVIDUAL. — For purposes of this subparagraph, the term 'eligible individual' means, with respect to any taxable year, any individual who has one or more qualified unemployment periods determined as of the beginning of such taxable year.

"(iv) QUALIFIED UNEMPLOYMENT PERIOD. — For purposes of this subparagraph, the term 'qualified unemployment period' means, with respect to any individual, any uninterrupted period —

"(I) which is not less than 1 year,

"(II) which begins after such individual attains age 18, and

"(III) during which such individual has no earned income (as defined in section 32(c)(2)) on account of such individual's provision of care to one or more qualifying individuals (as defined in section 21(b)(1)).

"(v) DECLARATION REQUIREMENT. — A qualified unemployment period shall not be taken into account under this subparagraph with respect to any individual unless such individual has submitted to the Secretary a written declaration made under the penalties of perjury that such period meets the requirements of clause (iv) with respect to such individual. The trustee may rely on such declaration unless the trustee knows, or has reason to know, that such declaration is false.".

(b) ELECTIVE DEFERRALS. — Section 414(v) of such Code is amended by adding at the end the following new paragraph:

"(7) REDUCTION OF AGE FOR MAKING CATCH-UP CONTRIBUTIONS FOR INDIVIDUALS OUT OF WORKFORCE TO PROVIDE DEPENDENT CARE SERVICES. —

"(A) IN GENERAL. — In the case of an eligible participant, paragraph (5)(A) shall be applied by substituting 'the applicable age with respect to such participant' for 'age 50'.

"(B) APPLICATION OF DEFINITIONS AND RULES. — For purposes of this paragraph, clauses (ii), (iii), (iv), and (v) of section 219(b)(5)(D) shall apply —

"(i) by substituting 'participant' for 'individual' each place it appears in such clauses, and

"(ii) by substituting 'plan administrator' for 'trustee' in such clause (v).

"(C) ERROR CORRECTION. — The Secretary shall issue regulations or other guidance under which an applicable employer plan may correct for an impermissible catch-up contribution by providing for a distribution of such contribution together with any earnings properly attributable thereto.".

(c) EFFECTIVE DATE. — The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.