Legislative updates

Representative Cathy Rodgers (R-WA), has introduced the ABLE Tomorrow Act. According to a press release, the proposal would do the following.

• Make the ABLE to Work Act and ABLE Financial Planning Act permanent
• Eliminate the Medicaid clawback in the original ABLE Act
• Allow for a one-time lump sum into an ABLE account beyond the $18,000 per gift tax contribution limit for certain instances
• Allow an employer to make contributions to an ABLE eligible worker’s 529A account in lieu of contributions to the employer’s defined contribution plan

The Internal Revenue Service (IRS) recently issued Notice 2024-77, providing interim guidance on the treatment of “inadvertent benefit overpayments” from defined benefit and defined contribution plans as provided by Section 301 of the SECURE 2.0 Act of 2022 (SECURE 2.0). This interim guidance specifically refers to the application of the plan qualification and rollover distribution rules provided by Internal Revenue Code Sections (IRC Secs.) 414(aa) and 402(c)(12) to the correction methods available for inadvertent benefit overpayments under the Employee Plans Compliance Resolution System (EPCRS) as outlined in Revenue Procedure (Rev. Proc.) 2021-30.

The IRS has posted final regulations regarding income tax withholding on certain periodic payments and nonperiodic distributions from employer deferred compensation plans, individual retirement plans, and commercial annuities that are not eligible rollover distributions.

The Social Security Administration has issued the 2025 adjustments for benefits and certain other limitations that are subject to annual cost-of-living adjustment (COLA) indices.

Representative Mark DeSaulnier (D-CA) has introduced HR 9820 – the Employee and Retiree Access to Justice Act.

Representative Brittany Pettersen (D-Co), and co-sponsor Maria Salazar (R-FL), have introduced H.R. 9764, the Catching Up Family Caregivers Act. According to a press release, the bill would allow family caregivers to make catch-up contributions to employer-sponsored retirement plans, an option typically reserved for those over age 50. For every year they are out of the workforce, caregivers could be eligible for an additional year of catch-up contributions, up to a maximum of five years.

The IRS has issued Notice 2024-73, providing question-and-answer guidance on long-term, part-time employees in 403(b) plans. Guidance is applicable for plan years beginning after December 31, 2024.

Representatives Lloyd Smucker (R-PA), and Don Beyer (D-VA), have introduced  H.R. 9614, the Ensuring Nationwide Access to a Better Life Experience (ENABLE) Act. The proposal would make permanent the following provisions that are set to expire at the end of 2025. 

In 2019, the SECURE Act made several changes to the rules for retirement plans and IRAs, including raising the applicable RMD age from 70½ to 72.R2024 10 01 Secure 2 0 Rmd Changes Infographic

Senator Tim Scott (R-SC), Ranking Member of the Senate Committee on Banking, Housing, and Urban Affairs, along with fellow republican committee members Senators Mike Crapo (R-ID), Mike Rounds (R-SD), Thom Tillis (R-NC), John Kennedy (R-LA), Bill Hagerty (R-TN), Cynthia Lummis (R-WY), Katie Britt (R-AL), Kevin Cramer (R-ND), Steve Daines (R-MT), and Jerry Moran (R-KS), have introduced S. 5139, Empowering Main Street in America Act of 2024.