,,ii  #aafth ,,congress  #ast ,session  
,s4 #cba  ,,in ,,the ,,senate ,,of ,,the
 ,,united ,,states  ,february #d1       
#bjai,ms4 ,collins 7for herself and ,ms4
 ,hassan7 introduced the following bill2
 which was read twice and referred to   
the ,committee on ,finance  ,a ,,bill   
,to amend the ,internal ,revenue ,code  
of #aihf to modify safe harbor          
requirements applicable to automatic    
contribution arrangements1 and for other
 purposes4  #a4 ,short title ,this ,act 
may be cited as the ,retirement         
,security ,act of #bjai4  #b4 ,multiple 
employer plans  7a7 ,qualification      
requirements  7#a7 ,in general ,section 
#dac of the ,internal ,revenue ,code of 
#aihf is amended by adding at the end   
the following new subsection3  7e7      
,application of qualification           
requirements for certain multiple       
employer plans with pooled plan         
providers  7#a7 ,in general ,except as  
provided in paragraph 7#b71 if a defined
 contribution plan to which subsection  

7c7 applies--  7,a7 is maintained by    
employers which have a common interest  
other than having adopted the plan1 or  
7,b7 in the case of a plan not described
 in subparagraph 7,a71 has a pooled plan
 provider1  then the plan shall not be  
treated as failing to meet the          
requirements under this title applicable
 to a plan described in section #dja7;a7
 or to a plan that consists of          
individual retirement accounts described
 in section #djh 7including by reason of
 subsection 7c7 thereof71 whichever is  
applicable1 merely because one or more  
employers of employees covered by the   
plan fail to take such actions as are   
required of such employers for the plan 
to meet such requirements4  7#b7        
,limitations  7,a7 ,in general          
,paragraph 7#a7 shall not apply to any  
plan unless the terms of the plan       
provide that in the case of any employer
 in the plan failing to take the actions
 described in paragraph 7#a7--  7i7 the 
assets of the plan attributable to      

employees of such employer 7or          
beneficiaries of such employees7 will be
 transferred to a plan maintained only  
by such employer 7or its successor71 to 
an eligible retirement plan as defined  
in section #djb7;c77#h77;,b7 for each   
individual whose account is transferred1
 or to any other arrangement that the   
,secretary determines is appropriate1   
unless the ,secretary determines it is  
in the best interests of the employees  
of such employer 7and the beneficiaries 
of such employees7 to retain the assets 
in the plan1 and  7ii7 such employer    
7and not the plan with respect to which 
the failure occurred or any other       
employer in such plan7 shall1 except to 
the extent provided by the ,secretary1  
be liable for any liabilities with      
respect to such plan attributable to    
employees of such employer 7or          
beneficiaries of such employees74  7,b7 
,failures by pooled plan providers ,if  
the pooled plan provider of a plan      
described in paragraph 7#a77;,b7 does   

not perform substantially all of the    
administrative duties which are required
 of the provider under paragraph        
7#c77;,a77i7 for any plan year1 the     
,secretary may provide that the         
determination as to whether the plan    
meets the requirements under this title 
applicable to a plan described in       
section #dja7;a7 or to a plan that      
consists of individual retirement       
accounts described in section #djh      
7including by reason of subsection 7c7  
thereof71 whichever is applicable1 shall
 be made in the same manner as would be 
made without regard to paragraph 7#a74  
7#c7 ,pooled plan provider  7,a7 ,in    
general ,for purposes of this           
subsection1 the term pooled plan        
provider means1 with respect to any     
plan1 a person who-- 7i7 is designated  
by the terms of the plan as a named     
fiduciary 7within the meaning of section
 #djb7;a77#b7 of the ,employee          
,retirement ,income ,security ,act of   
#aigd71 as the plan administrator1 and  

as the person responsible to perform all
 administrative duties 7including       
conducting proper testing with respect  
to the plan and the employees of each   
employer in the plan7 which are         
reasonably necessary to ensure that--   
7,i7 the plan meets any requirement     
applicable under the ,employee          
,retirement ,income ,security ,act of   
#aigd or this title to a plan described 
in section #dja7;a7 or to a plan that   
consists of individual retirement       
accounts described in section #djh      
7including by reason of subsection 7c7  
thereof71 whichever is applicable1 and  
7,,ii7 each employer in the plan takes  
such actions as the ,secretary or such  
person determines are necessary for the 
plan to meet the requirements described 
in subclause 7,i71 including providing  
to such person any disclosures or other 
information which the ,secretary may    
require or which such person otherwise  
determines are necessary to administer  
the plan or to allow the plan to meet   

such requirements1  7ii7 registers as a 
pooled plan provider with the           
,secretary1 and provides such other     
information to the ,secretary as the    
,secretary may require1 before beginning
 operations as a pooled plan provider1  
7iii7 acknowledges in writing that such 
person is a named fiduciary 7within the 
meaning of section #djb7;a77#b7 of the  
,employee ,retirement ,income ,security 
,act of #aigd71 and the plan            
administrator1 with respect to the plan1
 and  7iv7 is responsible for ensuring  
that all persons who handle assets of1  
or who are fiduciaries of1 the plan are 
bonded in accordance with section #dab  
of the ,employee ,retirement ,income    
,security ,act of #aigd4  7,b7 ,audits1 
examinations and investigations ,the    
,secretary may perform audits1          
examinations1 and investigations of     
pooled plan providers as may be         
necessary to enforce and carry out the  
purposes of this subsection4  7,c7      
,aggregation rules ,for purposes of this

 paragraph1 in determining whether a    
person meets the requirements of this   
paragraph to be a pooled plan provider  
with respect to any plan1 all persons   
who perform services for the plan and   
who are treated as a single employer    
under subsection 7b71 7c71 7m71 or 7o7  
of section #dad shall be treated as one 
person4  7,d7 ,treatment of employers as
 plan sponsors ,except with respect to  
the administrative duties of the pooled 
plan provider described in subparagraph 
7,a77i71 each employer in a plan which  
has a pooled plan provider shall be     
treated as the plan sponsor with respect
 to the portion of the plan attributable
 to employees of such employer 7or      
beneficiaries of such employees74  7#d7 
,guidance ,the ,secretary shall issue   
such guidance as the ,secretary         
determines appropriate to carry out this
 subsection1 including guidance--  7,a7 
to identify the administrative duties   
and other actions required to be        
performed by a pooled plan provider     

under this subsection1  7,b7 which      
describes the procedures to be taken to 
terminate a plan which fails to meet the
 requirements to be a plan described in 
paragraph 7#a71 including the proper    
treatment of1 and actions needed to be  
taken by1 any employer in the plan and  
the assets and liabilities of the plan  
attributable to employees of such       
employer 7or beneficiaries of such      
employees71 and  7,c7 identifying       
appropriate cases to which the rules of 
paragraph 7#b77;,a7 will apply to       
employers in the plan failing to take   
the actions described in paragraph 7#a74
  ,the ,secretary shall take into       
account under subparagraph 7,c7 whether 
the failure of an employer or pooled    
plan provider to provide any disclosures
 or other information1 or to take any   
other action1 necessary to administer a 
plan or to allow a plan to meet         
requirements applicable to the plan     
under section #dja7;a7 or #djh1         
whichever is applicable1 has continued  

over a period of time that demonstrates 
a lack of commitment to compliance4     
7#e7 ,model plan ,the ,secretary shall  
publish model plan language which meets 
the requirements of this subsection and 
of paragraphs 7#dc7 and 7#dd7 of section
 #c of the ,employee ,retirement ,income
 ,security ,act of #aigd and which may  
be adopted in order for a plan to be    
treated as a plan described in paragraph
 7#a77;,b74  4  7#b7 ,conforming        
amendment ,section #dac7;c77#b7 of such 
,code is amended by striking section    
#dja7;a7 and inserting sections #dja7;a7
 and #djh7;c74  7#c7 ,technical         
amendment ,section #djh7;c7 of such     
,code is amended by inserting after     
paragraph 7#b7 the following new        
paragraph3  7#c7 ,there is a separate   
accounting for any interest of an       
employee or member 7or spouse of an     
employee or member7 in a ,roth ,,ira4  4
  7b7 ,no common interest required for  
pooled employer plans ,section #c7b7 of 
the ,employee ,retirement ,income       

,security ,act of #aigd 7#bi ,u4,s4,c4  
#ajjb7b77 is amended by adding at the   
end the following3  7,c7 ,a pooled      
employer plan shall be treated as-- 7i7 
a single employee pension benefit plan  
or single pension plan2 and  7ii7 a plan
 to which section #baj7;a7 applies4  4  
7c7 ,pooled employer plan and provider  
defined  7#a7 ,in general ,section #c of
 the ,employee ,retirement ,income      
,security ,act of #aigd 7#bi ,u4,s4,c4  
#ajjb7 is amended by adding at the end  
the following3  7#dc7 ,pooled employer  
plan  7,a7 ,in general ,the term pooled 
employer plan means a plan-- 7i7 which  
is an individual account plan           
established or maintained for the       
purpose of providing benefits to the    
employees of #b or more employers2  7ii7
 which is a plan described in section   
#dja7;a7 of the ,internal ,revenue ,code
 of #aihf which includes a trust exempt 
from tax under section #eja7;a7 of such 
,code or a plan that consists of        
individual retirement accounts described

 in section #djh of such ,code          
7including by reason of subsection 7c7  
thereof72 and  7iii7 the terms of which 
meet the requirements of subparagraph   
7,b74  ,such term shall not include a   
plan maintained by employers which have 
a common interest other than having     
adopted the plan4  7,b7 ,requirements   
for plan terms ,the requirements of this
 subparagraph are met with respect to   
any plan if the terms of the plan--  7i7
 designate a pooled plan provider and   
provide that the pooled plan provider is
 a named fiduciary of the plan2  7ii7   
designate one or more trustees meeting  
the requirements of section #djh7;a77#b7
 of the ,internal ,revenue ,code of     
#aihf 7other than an employer in the    
plan7 to be responsible for collecting  
contributions to1 and holding the assets
 of1 the plan and require such trustees 
to implement written contribution       
collection procedures that are          
reasonable1 diligent1 and systematic2   
7iii7 provide that each employer in the 

plan retains fiduciary responsibility   
for-- 7,i7 the selection and monitoring 
in accordance with section #djd7;a7 of  
the person designated as the pooled plan
 provider and any other person who1 in  
addition to the pooled plan provider1 is
 designated as a named fiduciary of the 
plan2 and  7,,ii7 to the extent not     
otherwise delegated to another fiduciary
 by the pooled plan provider and subject
 to the provisions of section #djd7;c71 
the investment and management of the    
portion of the plan's assets            
attributable to the employees of the    
employer 7or beneficiaries of such      
employees72  7iv7 provide that employers
 in the plan1 and participants and      
beneficiaries1 are not subject to       
unreasonable restrictions1 fees1 or     
penalties with regard to ceasing        
participation1 receipt of distributions1
 or otherwise transferring assets of the
 plan in accordance with section #bjh or
 paragraph 7#dd77;,c77i77,,ii72  7v7    
require-- 7,i7 the pooled plan provider 

to provide to employers in the plan any 
disclosures or other information which  
the ,secretary may require1 including   
any disclosures or other information to 
facilitate the selection or any         
monitoring of the pooled plan provider  
by employers in the plan2 and  7,,ii7   
each employer in the plan to take such  
actions as the ,secretary or the pooled 
plan provider determines are necessary  
to administer the plan or for the plan  
to meet any requirement applicable under
 this ,act or the ,internal ,revenue    
,code of #aihf to a plan described in   
section #dja7;a7 of such ,code or to a  
plan that consists of individual        
retirement accounts described in section
 #djh of such ,code 7including by reason
 of subsection 7c7 thereof71 whichever  
is applicable1 including providing any  
disclosures or other information which  
the ,secretary may require or which the 
pooled plan provider otherwise          
determines are necessary to administer  
the plan or to allow the plan to meet   

such requirements2 and  7vi7 provide    
that any disclosure or other information
 required to be provided under clause   
7v7 may be provided in electronic form  
and will be designed to ensure only     
reasonable costs are imposed on pooled  
plan providers and employers in the     
plan4  7,c7 ,exceptions ,the term pooled
 employer plan does not include-- 7i7 a 
multiemployer plan2 or  7ii7 a plan     
established before the date of the      
enactment of the ,retirement ,security  
,act of #bjai1 unless the plan          
administrator elects that the plan will 
be treated as a pooled employer plan and
 the plan meets the requirements of this
 title applicable to a pooled employer  
plan established on or after such date4 
7,d7 ,treatment of employers as plan    
sponsors ,except with respect to the    
administrative duties of the pooled plan
 provider described in paragraph        
7#dd77;,a77i71 each employer in a pooled
 employer plan shall be treated as the  
plan sponsor with respect to the portion

 of the plan attributable to employees  
of such employer 7or beneficiaries of   
such employees74  7#dd7 ,pooled plan    
provider  7,a7 ,in general ,the term    
pooled plan provider means a person     
who-- 7i7 is designated by the terms of 
a pooled employer plan as a named       
fiduciary1 as the plan administrator1   
and as the person responsible for the   
performance of all administrative duties
 7including conducting proper testing   
with respect to the plan and the        
employees of each employer in the plan7 
which are reasonably necessary to ensure
 that--  7,i7 the plan meets any        
requirement applicable under this ,act  
or the ,internal ,revenue ,code of #aihf
 to a plan described in section #dja7;a7
 of such ,code or to a plan that        
consists of individual retirement       
accounts described in section #djh of   
such ,code 7including by reason of      
subsection 7c7 thereof71 whichever is   
applicable2 and  7,,ii7 each employer in
 the plan takes such actions as the     

,secretary or pooled plan provider      
determines are necessary for the plan to
 meet the requirements described in     
subclause 7,i71 including providing the 
disclosures and information described in
 paragraph 7#dc77;,b77v77,,ii72  7ii7   
registers as a pooled plan provider with
 the ,secretary1 and provides to the    
,secretary such other information as the
 ,secretary may require1 before         
beginning operations as a pooled plan   
provider2  7iii7 acknowledges in writing
 that such person is a named fiduciary1 
and the plan administrator1 with respect
 to the pooled employer plan2 and  7iv7 
is responsible for ensuring that all    
persons who handle assets of1 or who are
 fiduciaries of1 the pooled employer    
plan are bonded in accordance with      
section #dab4  7,b7 ,audits1            
examinations and investigations ,the    
,secretary may perform audits1          
examinations1 and investigations of     
pooled plan providers as may be         
necessary to enforce and carry out the  

purposes of this paragraph and paragraph
 7#dc74  7,c7 ,guidance ,the ,secretary 
shall issue such guidance as the        
,secretary determines appropriate to    
carry out this paragraph and paragraph  
7#dc71 including guidance--  7i7 to     
identify the administrative duties and  
other actions required to be performed  
by a pooled plan provider under either  
such paragraph2 and  7ii7 which requires
 in appropriate cases that if an        
employer in the plan fails to take the  
actions required under subparagraph     
7,a77i77,,ii7--  7,i7 the assets of the 
plan attributable to employees of such  
employer 7or beneficiaries of such      
employees7 are transferred to a plan    
maintained only by such employer 7or its
 successor71 to an eligible retirement  
plan as defined in section              
#djb7;c77#h77;,b7 of the ,internal      
,revenue ,code of #aihf for each        
individual whose account is transferred1
 or to any other arrangement that the   
,secretary determines is appropriate in 

such guidance2 and  7,,ii7 such employer
 7and not the plan with respect to which
 the failure occurred or any other      
employer in such plan7 shall1 except to 
the extent provided in such guidance1 be
 liable for any liabilities with respect
 to such plan attributable to employees 
of such employer 7or beneficiaries of   
such employees74  ,the ,secretary shall 
take into account under clause 7ii7     
whether the failure of an employer or   
pooled plan provider to provide any     
disclosures or other information1 or to 
take any other action1 necessary to     
administer a plan or to allow a plan to 
meet requirements described in          
subparagraph 7,a77i77,,ii7 has continued
 over a period of time that demonstrates
 a lack of commitment to compliance4    
,the ,secretary may waive the           
requirements of subclause 7ii77,i7 in   
appropriate circumstances if the        
,secretary determines it is in the best 
interests of the employees of the       
employer referred to in such clause 7and

 the beneficiaries of such employees7 to
 retain the assets in the plan with     
respect to which the employer's failure 
occurred4  7,d7 ,aggregation rules ,for 
purposes of this paragraph1 in          
determining whether a person meets the  
requirements of this paragraph to be a  
pooled plan provider with respect to any
 plan1 all persons who perform services 
for the plan and who are treated as a   
single employer under subsection 7b71   
7c71 7m71 or 7o7 of section #dad of the 
,internal ,revenue ,code of #aihf shall 
be treated as one person4  4  7#b7      
,bonding requirements for pooled        
employer plans ,the last sentence of    
section #dab7;a7 of the ,employee       
,retirement ,income ,security ,act of   
#aigd 7#bi ,u4,s4,c4 #aaab7;a77 is      
amended by inserting or in the case of a
 pooled employer plan 7as defined in    
section #c7dc77 after section           
#djg7;d77#a774  7#c7 ,conforming and    
technical amendments ,section #c of the 
,employee ,retirement ,income ,security 

,act of #aigd 7#bi ,u4,s4,c4 #ajjb7 is  
amended-- 7,a7 in paragraph 7#af77;,b7--
  7i7 by striking or at the end of      
clause 7ii72 and  7ii7 by striking the  
period at the end and inserting 1 or    
7iv7 in the case of a pooled employer   
plan1 the pooled plan provider42 and    
7,b7 by striking the second paragraph   
7#da74  7d7 ,effective date  7#a7 ,in   
general ,the amendments made by this    
section shall apply to years beginning  
after ,december #ca1 #bjai4  7#b7 ,rule 
of construction ,nothing in the         
amendments made by subsection 7a7 shall 
be construed as limiting the authority  
of the ,secretary of the ,treasury or   
the ,secretary's delegate 7determined   
without regard to such amendment7 to    
provide for the proper treatment of a   
failure to meet any requirement         
applicable under the ,internal ,revenue 
,code of #aihf with respect to one      
employer 7and its employees7 in a       
multiple employer plan4  #c4 ,pooled    
employer and multiple employer plan     

reporting  7a7 ,additional information  
,section #ajc of the ,employee          
,retirement ,income ,security ,act of   
#aigd 7#bi ,u4,s4,c4 #ajbc7 is amended--
 7#a7 in subsection 7a77#a77;,b71 by    
striking applicable subsections 7d71    
7e71 and 7f7 and inserting applicable   
subsections 7d71 7e71 7f71 and 7g72 and 
7#b7 by amending subsection 7g7 to read 
as follows3  7g7 ,additional information
 with respect to pooled employer and    
multiple employer plans ,an annual      
report under this section for a plan    
year shall include--  7#a7 with respect 
to any plan to which section #baj7;a7   
applies 7including a pooled employer    
plan71 a list of participating employers
 and a good faith estimate of the       
percentage of total contributions made  
by such participating employers during  
the plan year2 and  7#b7 with respect to
 a pooled employer plan1 the identifying
 information for the person designated  
under the terms of the plan as the      
pooled plan provider4  4  7b7           

,simplified annual reports ,section     
#ajd7;a7 of the ,employee ,retirement   
,income ,security ,act of #aigd 7#bi    
,u4,s4,c4 #ajbd7;a77 is amended by      
striking paragraph 7#b77;,a7 and        
inserting the following3  7#b7 7,a7     
,with respect to annual reports required
 to be filed with the ,secretary under  
this part1 the ,secretary may by        
regulation prescribe simplified annual  
reports for any pension plan that--  7i7
 covers fewer than #ajj participants2 or
  7ii7 is a plan described in section   
#baj7;a7 that covers fewer than #a1jjj  
participants1 but only if no single     
participating employer has #ajj or more 
participants covered by the plan4  4    
7c7 ,effective date ,the amendments made
 by this section shall apply to annual  
reports for plan years beginning after  
,december #ca1 #bjai4  #d4 ,removal of  
#aj percent cap from automatic          
enrollment safe harbor after #ast plan  
year  7a7 ,in general ,clause 7iii7 of  
section #dja7k77#ac77;,c7 of the        

,internal ,revenue ,code of #aihf is    
amended by striking 1 does not exceed   
#aj percent1 and is at least and        
inserting and is4  7b7 ,conforming      
amendments  7#a7 ,subclause 7,i7 of     
section #dja7k77#ac77;,c77iii7 of the   
,internal ,revenue ,code of #aihf is    
amended by striking #c percent and      
inserting at least #c percent1 but not  
greater than #aj percent14  7#b7        
,subclause 7,,ii7 of section            
#dja7k77#ac77;,c77iii7 of such ,code is 
amended by striking #d percent and      
inserting at least #d percent4  7#c7    
,subclause 7,,iii7 of section           
#dja7k77#ac77;,c77iii7 of such ,code is 
amended by striking #e percent and      
inserting at least #e percent4  7#d7    
,subclause 7,,iv7 of section            
#dja7k77#ac77;,c77iii7 of such ,code is 
amended by striking #f percent and      
inserting at least #f percent4  7c7     
,effective date ,the amendments made by 
this section shall apply to plan years  
beginning after ,december #ca1 #bjai4   

#e4 ,rules relating to election of safe 
harbor #dja7k7 status  7a7 ,limitation  
of annual safe harbor notice to matching
 contribution plans  7#a7 ,in general   
,subparagraph 7,a7 of section           
#dja7k77#ab7 of the ,internal ,revenue  
,code of #aihf is amended by striking if
 such arrangement and all that follows  
and inserting 8if such arrangement--    
7i7 meets the contribution requirements 
of subparagraph 7,b7 and the notice     
requirements of subparagraph 7,d71 or   
7ii7 meets the contribution requirements
 of subparagraph 7,c74  4  7#b7         
,automatic contribution arrangements    
,subparagraph 7,b7 of section           
#dja7k77#ac7 of such ,code is amended by
 striking means and all that follows and
 inserting 8means a cash or deferred    
arrangement--  7i7 which is described in
 subparagraph 7,d77i77,i7 and meets the 
applicable requirements of subparagraphs
 7,c7 through 7,e71 or  7ii7 which is   
described in subparagraph 7,d77i77,,ii7 
and meets the applicable requirements of

 subparagraphs 7,c7 and 7,d74  4  7b7   
,nonelective contributions ,section     
#dja7k77#ab7 of the ,internal ,revenue  
,code of #aihf is amended by            
redesignating subparagraph 7,f7 as      
subparagraph 7,g71 and by inserting     
after subparagraph 7,e7 the following   
new subparagraph3  7,f7 ,timing of plan 
amendment for employer making           
nonelective contributions  7i7 ,in      
general ,except as provided in clause   
7ii71 a plan may be amended after the   
beginning of a plan year to provide that
 the requirements of subparagraph 7,c7  
shall apply to the arrangement for the  
plan year1 but only if the amendment is 
adopted--  7,i7 at any time before the  
#cjth day before the close of the plan  
year1 or  7,,ii7 at any time before the 
last day under paragraph 7#h77;,a7 for  
distributing excess contributions for   
the plan year4  7ii7 ,exception where   
plan provided for matching contributions
 ,clause 7i7 shall not apply to any plan
 year if the plan provided at any time  

during the plan year that the           
requirements of subparagraph 7,b7 or    
paragraph 7#ac77;,d77i77,i7 applied to  
the plan year4  7iii7 #d-percent        
contribution requirement ,clause        
7i77,,ii7 shall not apply to an         
arrangement unless the amount of the    
contributions described in subparagraph 
7,c7 which the employer is required to  
make under the arrangement for the plan 
year with respect to any employee is an 
amount equal to at least #d percent of  
the employee's compensation4  4  7c7    
,automatic contribution arrangements    
,section #dja7k77#ac7 of the ,internal  
,revenue ,code of #aihf is amended by   
adding at the end the following3  7,f7  
,timing of plan amendment for employer  
making nonelective contributions  7i7   
,in general ,except as provided in      
clause 7ii71 a plan may be amended after
 the beginning of a plan year to provide
 that the requirements of subparagraph  
7,d77i77,,ii7 shall apply to the        
arrangement for the plan year1 but only 

if the amendment is adopted--  7,i7 at  
any time before the #cjth day before the
 close of the plan year1 or  7,,ii7 at  
any time before the last day under      
paragraph 7#h77;,a7 for distributing    
excess contributions for the plan year4 
7ii7 ,exception where plan provided for 
matching contributions ,clause 7i7 shall
 not apply to any plan year if the plan 
provided at any time during the plan    
year that the requirements of           
subparagraph 7,d77i77,i7 or paragraph   
7#ab77;,b7 applied to the plan year4    
7iii7 #d-percent contribution           
requirement ,clause 7i77,,ii7 shall not 
apply to an arrangement unless the      
amount of the contributions described in
 subparagraph 7,d77i77,,ii7 which the   
employer is required to make under the  
arrangement for the plan year with      
respect to any employee is an amount    
equal to at least #d percent of the     
employee's compensation4  4  7d7        
,effective date ,the amendments made by 
this section shall apply to plan years  

beginning after ,december #ca1 #bjai4   
#f4 ,increase in credit limitation for  
small employer pension plan startup     
costs  7a7 ,in general ,paragraph 7#a7  
of section #de;,e7b7 of the ,internal   
,revenue ,code of #aihf is amended to   
read as follows3  7#a7 for the first    
credit year and each of the #b taxable  
years immediately following the first   
credit year1 the greater of--  7,a7     
#ejj1 or  7,b7 the lesser of--  7i7 #bej
 for each employee of the eligible      
employer who is not a highly compensated
 employee 7as defined in section        
#dad7q77 and who is eligible to         
participate in the eligible employer    
plan maintained by the eligible         
employer1 or  7ii7 #e1jjj1 and  4  7b7  
,effective date ,the amendment made by  
this section shall apply to taxable     
years beginning after ,december #ca1    
#bjai4  #g4 ,small employer automatic   
enrollment credit  7a7 ,in general      
,subpart ,d of part ,,iv of subchapter  
,a of chapter #a of the ,internal       

,revenue ,code of #aihf is amended by   
adding at the end the following new     
section3  #de,t4 ,auto-enrollment option
 for retirement savings options provided
 by small employers  7a7 ,in general    
,for purposes of section #ch1 in the    
case of an eligible employer1 the       
retirement auto-enrollment credit       
determined under this section for any   
taxable year is an amount equal to--    
7#a7 #ejj for any taxable year occurring
 during the credit period1 and  7#b7    
zero for any other taxable year4  7b7   
,credit period ,for purposes of         
subsection 7a7-- 7#a7 ,in general ,the  
credit period with respect to any       
eligible employer is the #c-taxable-year
 period beginning with the first taxable
 year for which the employer includes an
 eligible automatic contribution        
arrangement 7as defined in section      
#dad7w77#c77 in a qualified employer    
plan 7as defined in section #digb7;d77  
sponsored by the employer4  7#b7        
,maintenance of arrangement ,no taxable 

year with respect to an employer shall  
be treated as occurring within the      
credit period unless the arrangement    
described in paragraph 7#a7 is included 
in the plan for such year4  7c7         
,eligible employer ,for purposes of this
 section1 the term eligible employer has
 the meaning given such term in section 
#djh7p77#b77;,c77i74  4  7b7 ,credit ,to
 be part of general business credit     
,subsection 7b7 of section #ch of the   
,internal ,revenue ,code of #aihf is    
amended by striking plus at the end of  
paragraph 7#ca71 by striking the period 
at the end of paragraph 7#cb7 and       
inserting 1 plus1 and by adding at the  
end the following new paragraph3  7#cc7 
in the case of an eligible employer 7as 
defined in section #de,s7c771 the       
retirement auto-enrollment credit       
determined under section #de,t7a74  4   
7c7 ,clerical amendment ,the table of   
sections for subpart ,d of part ,,iv of 
subchapter ,a of chapter #a of the      
,internal ,revenue ,code of #aihf is    

amended by inserting after the item     
relating to section #de,s the following 
new item3  ,sec4 #de,t4 ,auto-enrollment
 option for retirement savings options  
provided by small employers4  4  7d7    
,effective date ,the amendments made by 
this section shall apply to taxable     
years beginning after ,december #ca1    
#bjai4  #h4 ,secure deferral            
arrangements  7a7 ,in general           
,subsection 7k7 of section #dja of the  
,internal ,revenue ,code of #aihf is    
amended by adding at the end the        
following new paragraph3  7#ae7         
,alternative method for secure deferral 
arrangements to meet nondiscrimination  
requirements  7,a7 ,in general ,a secure
 deferral arrangement shall be treated  
as meeting the requirements of paragraph
 7#c77;,a77ii74  7,b7 ,secure deferral  
arrangement ,for purposes of this       
paragraph1 the term secure deferral     
arrangement means any cash or deferred  
arrangement which meets the requirements
 of subparagraphs 7,c71 7,d71 and 7,e7  

of paragraph 7#ac71 except as modified  
by this paragraph4  7,c7 ,qualified     
percentage ,for purposes of this        
paragraph1 with respect to any employee1
 the term qualified percentage means1 in
 lieu of the meaning given such term in 
paragraph 7#ac77;,c77iii71 any          
percentage determined under the         
arrangement if such percentage is       
applied uniformly and is--  7i7 at least
 #f percent1 but not greater than #aj   
percent1 during the period ending on the
 last day of the first plan year which  
begins after the date on which the first
 elective contribution described in     
paragraph 7#ac77;,c77i7 is made with    
respect to such employee1  7ii7 at least
 #h percent during the first plan year  
following the plan year described in    
clause 7i71 and  7iii7 at least #aj     
percent during any subsequent plan year4
  7,d7 ,matching contributions  7i7 ,in 
general ,for purposes of this paragraph1
 an arrangement shall be treated as     
having met the requirements of paragraph

 7#ac77;,d77i7 if and only if the       
employer makes matching contributions on
 behalf of each employee who is not a   
highly compensated employee in an amount
 equal to the sum of--  7,i7 #ajj       
percent of the elective contributions of
 the employee to the extent that such   
contributions do not exceed #b percent  
of compensation1  7,,ii7 #ej percent of 
so much of such contributions as exceed 
#b percent but do not exceed #f percent 
of compensation1 plus  7,,iii7 #bj      
percent of so much of such contributions
 as exceed #f percent but do not exceed 
#aj percent of compensation4  7ii7      
,application of rules for matching      
contributions ,the rules of clause 7ii7 
of paragraph 7#ab77;,b7 and clauses     
7iii7 and 7iv7 of paragraph 7#ac77;,d7  
shall apply for purposes of clause 7i7  
but the rule of clause 7iii7 of         
paragraph 7#ab77;,b7 shall not apply for
 such purposes4 ,the rate of matching   
contribution for each incremental       
deferral must be at least as high as the

 rate specified in clause 7i71 and may  
be higher1 so long as such rate does not
 increase as an employee's rate of      
elective contributions increases4  4    
7b7 ,matching contributions and employee
 contributions ,subsection 7m7 of       
section #dja of the ,internal ,revenue  
,code of #aihf is amended by            
redesignating paragraph 7#ac7 as        
paragraph 7#ad7 and by inserting after  
paragraph 7#ab7 the following new       
paragraph3  7#ac7 ,alternative method   
for secure deferral arrangements ,a     
defined contribution plan shall be      
treated as meeting the requirements of  
paragraph 7#b7 with respect to matching 
contributions and employee contributions
 if the plan--  7,a7 is a secure        
deferral arrangement 7as defined in     
subsection 7k77#ae771  7,b7 meets the   
requirements of clauses 7ii7 and 7iii7  
of paragraph 7#aa77;,b71 and  7,c7      
provides that matching contributions on 
behalf of any employee may not be made  
with respect to an employee's           

contributions or elective deferrals in  
excess of #aj percent of the employee's 
compensation4  4  7c7 ,effective date   
,the amendments made by this section    
shall apply to plan years beginning     
after ,december #ca1 #bjai4  #i4 ,credit
 for employers with respect to modified 
safe harbor requirements  7a7 ,in       
general ,subpart ,d of part ,,iv of     
subchapter ,a of chapter #a of the      
,internal ,revenue ,code of #aihf1 as   
amended by section #g1 is further       
amended by adding at the end the        
following new section3  #de,u4 ,credit  
for small employers with respect to     
modified safe harbor requirements for   
automatic contribution arrangements  7a7
 ,general rule ,for purposes of section 
#ch1 in the case of a small employer1   
the safe harbor adoption credit         
determined under this section for any   
taxable year is the amount equal to the 
total of the employer's matching        
contributions under section             
#dja7k77#ae77;,d7 during the taxable    

year on behalf of employees who are not 
highly compensated employees1 subject to
 the limitations of subsection 7b74  7b7
 ,limitations  7#a7 ,limitation with    
respect to compensation ,the credit     
determined under subsection 7a7 with    
respect to contributions made on behalf 
of an employee who is not a highly      
compensated employee shall not exceed #b
 percent of the compensation of such    
employee for the taxable year4  7#b7    
,limitation with respect to years of    
participation ,credit shall be          
determined under subsection 7a7 with    
respect to contributions made on behalf 
of an employee who is not a highly      
compensated employee only during the    
first #e years such employee            
participates in the qualified automatic 
contribution arrangement4  7c7          
,definitions  7#a7 ,in general ,any term
 used in this section which is also used
 in section #dja7k77#ae7 shall have the 
same meaning as when used in such       
section4  7#b7 ,small employer ,the term

 small employer means an eligible       
employer 7as defined in section         
#djh7p77#b77;,c77i774  7d7 ,denial of   
double benefit ,no deduction shall be   
allowable under this title for any      
contribution with respect to which a    
credit is allowed under this section4  4
  7b7 ,credit ,to be part of general    
business credit ,subsection 7b7 of      
section #ch of the ,internal ,revenue   
,code of #aihf1 as amended by section   
#g1 is further amended--  7#a7 by       
striking plus at the end of paragraph   
7#cb72  7#b7 by striking the period at  
the end of paragraph 7#cc7 and inserting
 1 plus2 and  7#c7 by adding at the end 
the following new paragraph3  7#cd7 the 
safe harbor adoption credit determined  
under section #de,u4  4  7c7 ,clerical  
amendment ,the table of sections for    
subpart ,d of part ,,iv of subchapter ,a
 of chapter #a of the ,internal ,revenue
 ,code of #aihf1 as amended by section  
#g1 is further amended by adding after  
the item relating to section #de,t the  

following new item3  ,sec4 #de,u4       
,credit for small employers with respect
 to modified safe harbor requirements   
for automatic contribution arrangements4
  4  7d7 ,effective date ,the amendments
 made by this section shall apply to    
taxable years that include any portion  
of a plan year beginning after ,december
 #ca1 #bjai4  #aj4 ,modification of     
regulations ,the ,secretary of the      
,treasury shall promulgate regulations  
or other guidance that-- 7#a7 simplify  
and clarify the rules regarding the     
timing of participant notices required  
under section #dja7k77#ac77;,e7 of the  
,internal ,revenue ,code of #aihf1 with 
specific application to--  7,a7 plans   
that allow employees to be eligible for 
participation immediately upon beginning
 employment2 and  7,b7 employers with   
multiple payroll and administrative     
systems2 and  7#b7 simplify and clarify 
the automatic escalation rules under    
sections #dja7k77#ac77;,c77iii7 and     
#dja7k77#ae77;,c7 of the ,internal      

,revenue ,code of #aihf in the context  
of employers with multiple payroll and  
administrative systems4  ,such          
regulations or guidance shall address   
the particular case of employees within 
the same plan who are subject to        
different notice timing and different   
percentage requirements1 and provide    
assistance for plan sponsors in managing
 such cases4