Bill Summary
This legislation, known as the "Vested Employee Pension Benefit Protection Act," aims to amend the Internal Revenue Code of 1986 in order to provide protection for employees in the building and construction industry who participate in multiemployer plans. These plans are designed to provide retirement benefits to employees who work for multiple employers in the same industry.
The Act includes a provision that allows for employees who have reached the age of 55 and are still working to receive distributions from their pension plans. This is meant to accommodate the unique working conditions and retirement needs of employees in the building and construction industry.
The Act also specifies that this provision will only apply to multiemployer plans that were established before January 1, 1970 and have received a written determination from the Internal Revenue Service confirming their qualified trust status. Additionally, this provision will not apply if the plan is in a state of financial jeopardy, known as "endangered or critical status."
This legislation also amends the Employee Retirement Income Security Act of 1974 to reflect the changes made to the Internal Revenue Code. These amendments will be effective for distributions made before, on, or after the date of the enactment of the Act.
Possible Impacts
1) This legislation could affect employees in the building and construction industry by allowing them to receive distributions from their pension plans at a younger age (age 55 instead of 62), which could potentially provide financial stability for those who may need to retire earlier due to the physically demanding nature of their jobs.
2) It could also affect employers in the building and construction industry who offer multiemployer plans, as they would need to comply with the new age requirement for distributions and ensure that their plans are in compliance with the Internal Revenue Code.
3) This legislation could also impact the Internal Revenue Service (IRS), as they would need to provide written determinations for plans that qualify for the modified age requirement and ensure that these plans are in compliance with the new law.
[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4043 Introduced in House (IH)]
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116th CONGRESS
1st Session
H. R. 4043
To amend the Internal Revenue Code of 1986 to protect employees in the
building and construction industry who are participants in
multiemployer plans, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
July 25, 2019
Mr. Luetkemeyer (for himself, Mr. Clay, Mr. Bost, Mr. Rodney Davis of
Illinois, and Mr. Shimkus) introduced the following bill; which was
referred to the Committee on Ways and Means, and in addition to the
Committee on Education and Labor, for a period to be subsequently
determined by the Speaker, in each case for consideration of such
provisions as fall within the jurisdiction of the committee concerned
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to protect employees in the
building and construction industry who are participants in
multiemployer plans, and for other purposes.
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 ``Vested Employee Pension Benefit
Protection Act''.
SEC. 2. MINIMUM AGE FOR DISTRIBUTIONS DURING WORKING RETIREMENT.
(a) Internal Revenue Code of 1986.--Section 401(a)(36) of the
Internal Revenue Code of 1986 is amended to read as follows:
``(36) Distributions during working retirement.--
``(A) In general.--A trust forming part of a
pension plan shall not be treated as failing to
constitute a qualified trust under this section solely
because the plan provides that a distribution may be
made from such trust to an employee who has attained
age 62 and who is not separated from employment at the
time of such distribution.
``(B) Certain employees in the building and
construction industry.--
``(i) In general.--In order to allow for
unique conditions of employment in the building
and construction industry, subparagraph (A)
shall be applied by substituting `age 55' for
`age 62' in the case of a multiemployer plan
described in section 4203(b)(1)(B)(i) of the
Employee Retirement Income Security Act of
1974, with respect to individuals who were
participants in such plan on or before April
30, 2013, if--
``(I) the trust to which
subparagraph (A) applies was in
existence before January 1, 1970,
``(II) before December 31, 2011, at
a time when the plan provided that
distributions may be made to an
employee who has attained age 55 and
who is not separated from employment at
the time of such distribution, the plan
received at least 1 written
determination from the Internal Revenue
Service that the trust to which
subparagraph (A) applies constituted a
qualified trust under this section, and
``(III) the plan provides that the
benefit accrued on account of service
performed after distributions begin
under subparagraph (A) (as modified by
subparagraph (B) without regard to this
subclause) shall be treated and paid as
a pension separate from the pension
earned before such distributions begin,
and that payment of such separate
benefit shall not commence until the
employee attains the plan's normal
retirement age.
``(ii) Suspension of payments if plan in
endangered or critical status.--Clause (i)
shall not apply to a multiemployer plan during
the period for which the multiemployer plan is
in endangered or critical status (as defined
under section 432) beginning after the first
year the plan is in either of such statuses and
ending with the first plan year for which the
plan is not in either of such statuses.''.
(b) Employee Retirement Income Security Act of 1974.--Section
3(2)(A) of Employee Retirement Income Security Act of 1974 (29 U.S.C.
1002(2)(A)) is amended by inserting before the period at the end the
following: ``(age 55 in the case of a plan to which section
401(a)(36)(B) of the Internal Revenue Code of 1986 applies)''.
(c) Effective Date.--The amendments made by this section shall
apply to distributions made before, on, or after the date of the
enactment of this Act.
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