Small Nonprofit Retirement Security Act of 2025
Sponsored By: Representative Buchanan
Introduced
Summary
Turns two small-employer retirement incentives into payroll-tax credits for tax-exempt nonprofits. The bill would let eligible 501(c) tax-exempt small employers claim the startup credit and the auto-enrollment credit against their payroll tax bill instead of as income tax credits, with rules limiting the credit to payroll tax paid and applying to taxable years beginning after December 31, 2024.
Show full summary
- Employers: Small tax-exempt organizations that run retirement plans could recoup startup and auto-enrollment costs directly through a payroll-tax credit, reducing out-of-pocket costs to launch or auto-enroll employees.
- Workers: More nonprofits may add or auto-enroll employees in retirement plans, which can raise retirement plan access and participation for employees of small tax-exempt employers.
- Federal finances and trust funds: The bill reduces Treasury receipts from payroll taxes and authorizes transfers from the general fund to the Social Security Old-Age and Survivors Insurance Trust Fund and the Disability Insurance Trust Fund equal to that revenue reduction.
*This change would reduce federal receipts and require general fund transfers to the Social Security trust funds equal to the lost revenue.*
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Bill Overview
Analyzed Economic Effects
2 provisions identified: 2 benefits, 0 costs, 0 mixed.
Payroll tax credit for small nonprofits
If enacted, small tax‑exempt nonprofits could use certain retirement plan credits to cut payroll taxes. It would cover the startup plan credit and the auto‑enrollment credit. For each year, the credit would be the smaller of the calculated credit or the employer Social Security payroll tax paid that year, and would apply only to calendar quarters in the applicable year. This would take effect for tax years starting after December 31, 2024.
Protect Social Security trust funds
If enacted, the government would move money from the general fund into the Social Security trust funds. Transfers would match the revenue lost because of the new nonprofit payroll tax credits. They would be timed to mirror normal flows so benefit funding stays protected.
Sponsors & CoSponsors
Sponsor
Buchanan
FL • R
Cosponsors
Panetta
CA • D
Sponsored 7/21/2025
Moore (UT)
UT • R
Sponsored 7/21/2025
Schneider
IL • D
Sponsored 7/21/2025
Bynum
OR • D
Sponsored 8/15/2025
McBride
DE • D
Sponsored 9/23/2025
Vindman
VA • D
Sponsored 12/9/2025
Roll Call Votes
No roll call votes available for this bill.
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