Updated November 2, 2020

U.S. Rep. Ron Kind (D-WI) and Rep. Jason Smith (R-MO) have introduced the Savings for All Vocations Enhancement (SAVE) Act, a bill that would encourage more S corporation ESOPs by allowing their selling owners to get the same Section 1042 tax deferral available to owners of C corporations who sell to a qualifying ESOP. The bill also makes changes to increase access to 403(b) employer-provided retirement plans, and bring IRA treatment in line with 401(k) rules. Mike Kelly (R-PA) and Jason Smith (R-MO) are cosponsors.

More important, on October 28, the language of the bill was also inserted into a new version of the 2019 SECURE Act, which reformed a variety of retirement plan rules and became law last year. The new version, the Securing Strong Retirement Act, makes further changes to the SECURE Act. It was introduced by Richard Neal (D-MA) and Kevin Brady (R-TX), the chair and ranking minority members of the House Ways and Means Committee, which writes tax legislation. Many of the same provisions in the Neal-Brady bill are in the bipartisan Retirement Security and Savings Act in the Senate. This suggests that prospects are good that the bill could become law in the next Congress.