Summary of changes:
– repeal the age cap for contributing to individual retirement accounts, currently 70½.
– increase the age to start taking required withdrawals from 401(k)s and IRAs to 72 from 70½.
– encourage 401(k)-style plans to offer annuities by giving certain employers some protection from future liability if their chosen insurer fails to pay claims.
– allow parents to withdraw up to $10,000 from 529 education-savings plans for repayments of some student loans .
– parents could take penalty-free distributions from retirement accounts of up to $5,000 within a year of the birth or adoption of a child to cover associated expenses.
– allow employers without an affiliation to band together to offer a 401(k)-type plan—an effort to encourage companies without retirement plans to offer them.
– repeal a 2017 change to the so-called Kiddie Tax that often boosts tax rates on “unearned” income received by children in low- and middle-income families and was causing surprise tax increases for many.
– To help pay for the changes, the House legislation would require many people who inherit tax-advantaged retirement accounts to withdraw the money within a decade and pay any taxes due. The Senate version, the Retirement Enhancement and Savings Act, or RESA, would require beneficiaries to liquidate balances above $400,000 at the date of death within five years.
The bill passed 417-3 and the Senate is expected to vote on the House Bill, according to the article.