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Comprehensive Pension and Retirement Security Act of 1996

Introduced: September 28, 1996 Introduced by: Schumer, Charles E. Democratic · New York See on congress.gov
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 Everywhere this bill has been 3 steps
Introduced
In committee
Reported out
Passed House
Passed Senate
To President
Became law
Oct 15, 1996
Referred to the Subcommittee on Employer-Employee Relations.
Sep 28, 1996
Referred to the Committee on Ways and Means, and in addition to the Committee on Economic and Educational Opportunities, 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.
Sep 28, 1996
Introduced in House
 Plain-English summary Congressional Research Service

TABLE OF CONTENTS:

Title I: Restrictions on Loans From Qualified Retirement

Plans

Title II: Promotion of Availability of Private Pensions Upon

Retirement

Title III: Health Coverage for Retired Workers

Title IV: Application of Certain Prohibited Transactions

Rules for 401(K) Plans

Title V: Retirement Savings and Security

Subtitle A: Expanded Pension Coverage and

Simplification

Subtitle B: Portability

Subtitle C: Enhanced Security

Title VI: Expanded Individual Retirement Accounts to

Increase Coverage and Portability

Subtitle A: Retirement Savings Incentives

Subtitle B: Distributions and Investments

Comprehensive Pension and Retirement Security Act of 1996 - Title I: Restrictions on Loans From Qualified Retirement Plans - Amends the Internal Revenue Code (IRC) to prohibit qualified employer plans from making loans through credit cards and other intermediaries.

(Sec. 102) Treats loans from qualified employer plans as distributions unless they are used to purchase a first home, to pay higher education or financially devastating medical expenses, or during periods of unemployment.

Title II: Promotion of Availability of Private Pensions Upon Retirement - Amends the Employee Retirement Income Security Act of 1974 (ERISA) and the IRC to require the availability of a defined contribution plan option (in lieu of the defined benefit plan) for participants in defined benefit plans to which an employer makes contributions.

(Sec. 202) Amends ERISA to require fiduciaries to make timely investments of plan contributions.

(Sec. 203) Amends IRC to increase the penalty for early distributions from pension plans.

Title III: Health Coverage for Retired Workers - Amends ERISA and the IRC to require advance notice of material reductions in covered services under group health plans.

(Sec. 302) Amends the IRC to set forth requirements relating to the duration of, and determination of premiums for, continuation of coverage for persons 55 and older until they are eligible for Medicare.

(Sec. 303) Amends the Social Security Act to set forth protections under the Medicare program for retired workers who lose retiree health benefits. Provides, in such cases, for: (1) no premium penalty for late enrollment; (2) a special Medicare enrollment period; and (3) a special rule with respect to the Medigap open enrollment period.

Title IV: Application of Certain Prohibited Transactions Rules for 401(K) Plans - Amends ERISA to set forth provisions relating to the application of certain prohibited transactions rules to IRC section 401(k) plans.

Title V: Retirement Savings and Security - Subtitle A: Expanded Pension Coverage and Simplification - Amends ERISA to eliminate a specified requirement for plan descriptions. Revises report-filing requirements for summary plan descriptions and descriptions of material modifications to a plan.

(Sec. 502) Revises ERISA to conform to the IRC with respect to treatment of investments in qualified state prepaid tuition programs.

Subtitle B: Portability - Directs the Pension Benefit Guaranty Corporation (PBGC) to prescribe specified rules relating to missing participants for multiemployer plans that terminate under certain ERISA provisions.

(Sec. 512) Eliminates a special vesting rule for multiemployer plans under ERISA.

(Sec. 513) Provides, with respect to treatment of loans during military service, that a loan made by a plan shall not fail to meet specified ERISA requirements by reason of a loan repayment suspension under the IRC.

Subtitle C: Enhanced Security - Revises certain formulas for determining payments with respect to multiemployer plan benefits guarantees under ERISA, for multiemployer plans that have not received specified financial assistance.

(Sec. 522) Directs the Secretary of Labor, as chairman of the PBGC board, to send a reversion report to the President and the Congress on plans from which residual assets were distributed to employers under specified ERISA.

(Sec. 523) Sets forth a full funding limitation for multiemployer plans under ERISA.

(Sec. 524) Increases maximum civil penalties for certain prohibited transactions under ERISA.

(Sec. 525) Modifies the phase-in of guarantee and the allocation of assets under ERISA provisions relating to substantial owner benefits.

Pension Audit Improvement Act of 1996 - Repeals specified ERISA provisions for limited scope audits.

(Sec. 533) Establishes certain reporting and enforcement requirements for employee benefit plans under ERISA. Requires a plan administrator to notify, within five business days, the Secretary of Labor of: (1) irregularities that may have occurred with respect to the plan; and (2) the termination of the plan's accountant. Requires plan accountants to notify the Secretary of: (1) such irregularities, if the administrator does not do so; and (2) any disagreements they may have with the reasons given by the administrator for their termination. Sets forth civil penalties for violations of such requirements.

(Sec. 534) Sets forth additional requirements for qualified public accountants for plans under ERISA.

(Sec. 535) Revises ERISA provisions for fiduciary penalties to: (1) modify a prohibition of assignment or alienation; (2) make discretionary the imposition and amount of civil penalties for breach of fiduciary responsibility; and (3) provide for the applicable recovery amount and other rules.

Title VI: Expanded Individual Retirement Accounts to Increase Coverage and Portability - Subtitle A: Retirement SavingsIncentives - Amends IRC provisions for individual retirement accounts (IRAs) and retirement savings with respect to: (1) certain income limitations; (2) inflation adjustments for the deductible amount and income limitations; (3) coordination of the IRA deduction limit with the elective deferral limit; and (4) establishment of special nondeductible tax-free IRAs.

Subtitle B: Distributions and Investments - Allows distributions from IRAs to be used without additional tax to purchase first homes, to pay higher education or financially devastating medical expenses, or by the unemployed.

(Sec. 612) Requires IRA contributions to be held at least five years in certain cases.

(Sec. 613) Sets forth special rules for IRA Investments in qualified State prepaid tuition program instruments.

What's happening now October 15, 1996

Referred to the Subcommittee on Employer-Employee Relations.

 Committees of jurisdiction 3