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HR7315119th CongressWALLET

Advancing Policy Priorities Act

Sponsored By: Representative Magaziner, Seth [D-RI-2]

In Committee

Summary

Retirement savings and worker protections are the bill's center. It would expand automatic enrollment and small‑employer credits, add retirement protections for federal employees injured on duty, and link veterans to registered apprenticeships.

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  • Veterans and transitioning service members would gain clearer access to apprenticeships. The Department of Labor and Veterans Affairs must list registered apprenticeship programs on a public site with program descriptions, veteran costs, endorsements, contact info, occupation and location search.
  • Workers and savers would see stronger default retirement rules. Plans with automatic enrollment would start at a minimum of 3% of pay and may rise by 1 percentage point each year under the bill's escalation rules.
  • Federal employees hurt on duty and plan sponsors would get new protections and incentives. The bill would let certain non‑covered service count as covered service for retirement credit and sets a 3‑day break‑in‑service limit for eligibility; it would also increase small employer startup credits up to 100% and let employers treat student‑loan payments as matching contributions.

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Bill Overview

Analyzed Economic Effects

22 provisions identified: 16 benefits, 1 costs, 5 mixed.

Bigger saver's credit and family relief

If enacted, the Saver's Credit rate would rise to 50% for eligible taxpayers, with income thresholds set at $48,000 for joint filers (and scaled amounts for other filers) for tax years after Dec. 31, 2028. The bill would also create a penalty-free early-withdrawal option for victims of domestic abuse (up to $10,000 or half of a vested benefit) with a three-year rollover window, and it clarifies that qualified birth or adoption distributions may be repaid any time during the three years after the distribution.

Retirement tax and penalty relief

If enacted, taxpayers could make a one-time election to treat up to $50,000 of direct IRA trustee distributions to qualifying split-interest trusts as qualified charitable distributions. The bill would cut the excise tax on missed required minimum distributions from 50% to 25%, and to 10% if the shortfall is corrected and reported during a defined correction window (applies to taxable years after Dec 31, 2024). The Treasury would also be required to boost outreach about the Saver's Credit and report plans within 90 days. Certain disability-related retirement payments for qualifying first responders would be excluded from gross income for tax years after Dec 31, 2029.

Bigger small-employer startup credit

If enacted, small employers would get a larger startup tax credit for creating or joining retirement plans. Employers that qualify under a 50-employee test could use a 100% credit rate, and the bill creates an extra per-employee credit based on employer contributions limited to $1,000 per employee with a five-year 100/75/50/25/0 schedule. These changes apply to taxable years after Dec. 31, 2024.

New Roth, catch-up, and RMD rules

If enacted, the bill would let SIMPLE plans and SEP IRAs offer Roth-designated contributions starting for tax years after Dec. 31, 2024, and allow employers to designate Roth matching contributions (which would be taxable when made). It would raise IRA catch-up indexing after 2025 and set higher catch-up dollar limits ($10,000 or $5,000) for ages 62–64 for tax years after Dec. 31, 2025. The bill would raise the forced-distribution threshold to $7,000 for distributions after Dec. 31, 2024 and create a staged increase in required minimum distribution ages for people who reach 72 after Dec. 31, 2024.

Default 401(k)/403(b) enrollment boosts

If enacted, many 401(k) and 403(b) plans would have to auto-enroll workers for plan years after Dec. 31, 2025. The default must start at least 3% of pay and rise by 1 percentage point each year until at least 10% (with limits on how high it can go). The bill would also allow small financial sign-up incentives, let employers match student loan payments the same way they match pay, expand hardship access, let administrators rely on an employee certification for urgent withdrawals, and create a safe rule for correcting auto-enroll mistakes.

Fixes, recoveries, and penalty relief

If enacted, the bill would let many plans and IRAs self-correct eligible inadvertent errors and expand safe harbors for loan and rollover mistakes. It would limit how plans recover inadvertent pension overpayments (no interest, a 10% annual cap for steady payments, and a 90% floor), and treat only the part of an IRA involved in a prohibited transaction as distributed. The bill would also clarify the three-year rule that starts the limitations period for certain IRA excise taxes.

Retirement credit for duty-disabled federal workers

If enacted, certain federal employees who suffer qualifying duty-related illness or injury and move without a break to a non-covered job in the same agency would have that later service treated as if it were covered service for retirement and withholding purposes. The rule applies only when the agency certifies the illness or injury and the change applies to qualifying injuries occurring on or after two years after enactment.

Rules for multi-employer and pooled plans

If enacted, the bill would let 403(b) annuity contracts bought under plans run by more than one employer be treated as valid 403(b) plans and treat such multi-employer arrangements as a single plan for registration and reporting. Pooled employer plans would have to name a non-employer fiduciary to collect contributions and follow written procedures. The bill also lets some employers run separate top-heavy tests for certain employee groups.

Tax break for some firefighters

If enacted, the bill would expand the 10% early-withdrawal penalty exception for firefighters to cover certain private-sector firefighter plan distributions made after Dec. 31, 2024. Eligible employees who provide firefighting services and meet plan rules could avoid the early distribution penalty on qualifying withdrawals.

Help for veteran entrepreneurs and employers

If enacted, the bill would create a Boots to Business entrepreneurship program to train service members, veterans, TAP participants, and their spouses through September 30, 2028. Grants to local resource partners and outreach would be allowed, but grants depend on Congress approving money. The bill would also let eligible small employers claim a per-employee credit for hiring military spouses: $250 for each military-spouse employee plus up to $250 of employer contributions per spouse. Each military spouse may be counted for the year participation begins and the two following years.

Late retirement deferrals for sole proprietors

If enacted, sole proprietors who own the entire business and are the only employee would be able to treat elective deferrals made before their tax filing deadline as having been made in the plan's first plan year. This lets some sole proprietors make late deferrals count for the earlier plan year. The rule would apply to plan years beginning after enactment.

Tougher penalties for crimes near schools

If enacted, the bill would add an extra prison term of up to five years for coercion or enticement crimes and for human trafficking when the offense occurs in a school zone, within 1,000 feet of a school activity, or on or within 1,000 feet of college property. The enhancement applies only when the offender knew or had reason to believe the victim was a student present for school-related reasons. The change would take effect on enactment.

Business and investor tax rules changed

If enacted, sellers of S-corporation stock to ESOPs would be limited to deferring gain on at most 10% of the sale for qualifying elections made after Dec. 31, 2029. The bill also changes family ownership attribution rules so some family stock ownership would not automatically merge separate corporations for controlled-group tests. These are business-side tax and aggregation changes that affect owners and investors.

Changes to financial product and market rules

If enacted, the bill would add tests for when ESOP-held company shares count as publicly traded for valuation (applying after Dec 31, 2029). The Treasury would be directed to allow exchange-traded funds to be investment options in variable annuity and life contracts, with rules for authorized participants (applies to certain investments seven years after enactment). NASA-related rules would let some longevity annuity limits be removed and protect survivor choices and a rescission period. Federal credit unions would face new board meeting frequency rules based on age and ratings.

Veteran apprenticeship and transition help

If enacted, the bill would require a public, searchable site listing registered apprenticeship programs, costs to veterans, veteran endorsements, hiring preferences, and credentials. It would also require transition counselors to include registered apprenticeship programs when advising separating service members. These steps would start on enactment and aim to make apprenticeship options easier for veterans to find.

Privacy rule for House whistleblowers

If enacted, the House would be barred from knowingly and willfully publicly disclosing the identity or personal information of individuals who report wrongdoing under certain whistleblower laws. Exceptions include written consent by the individual, public self-disclosure, and a committee chair after a two-thirds vote that disclosure is in the public interest with safeguards and, when possible, advance notice to the person. The rule would take effect on enactment.

Study on museum and NASA lease extra year

If enacted, an eight-member Commission would study creating a National Museum of Asian Pacific American History and Culture and must report on feasibility, fundraising plans, and independent review within 18 months of its first meeting. The Commission would not be allowed to obligate Federal funds and members would serve unpaid. The bill would also extend NASA's authority to lease non-excess property one more year, moving the expiration to Dec. 31, 2033.

Reports and rules on supply chains and DHS gear

If enacted, DHS would be required to use a uniform review process for grant requests to buy non‑standard equipment and the DHS Inspector General must report to Congress within three years on how the review worked. The Federal Maritime Commission would seek a research agreement within 90 days to study how foreign ownership of terminals at the 15 largest U.S. ports affects economic security and report within one year. SelectUSA would solicit states within 180 days and report within two years with recommendations to increase semiconductor foreign investment and strengthen supply chains.

Small FY2026 agency funding boosts

If enacted, the bill would add $1,000,000 each to several agencies for fiscal year 2026, including a Telehealth Resource Center, USDA Office of Budget and Program Analysis, State Department Capital Investment Fund, Army operations and maintenance, DHS Management Directorate, and the Energy Information Administration. Some of the amounts would remain available until expended and one amount is available through Sept. 30, 2025. These are small, targeted increases for named programs.

Livestock reporting requirement extended

If enacted, the bill would extend mandatory livestock reporting requirements by changing statutory references from 2024 to 2025. Producers and packers required to report would need to continue complying for one more year. The change takes effect on enactment.

Clearer pension notices and search tool

If enacted, the Labor Department would build an online "Retirement Savings Lost and Found" to help you find plan administrators within two years of enactment. The agencies would also review and recommend better pension reporting and disclosure within two years. At the same time, the bill lets plans stop sending most routine notices to eligible employees who are not enrolled and have no account balance, except for one annual eligibility reminder and any requested documents.

Timing rules for public-sector deferrals

If enacted, the timing rule for when government 457(b) plan deferral agreements must be made would change. Some eligible public employers would require deferral agreements before pay is currently available; other employers would require agreements before the month for which deferral applies. The change applies to taxable years after enactment.

Sponsors & CoSponsors

Sponsor

Magaziner, Seth [D-RI-2]

RI • D

Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

No roll call votes available for this bill.

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