President Trump on March 27 signed into law the sweeping $2 trillion stimulus bill that includes retirement relief provisions supported by the American Retirement Association.
It wasn’t easy – or at least not as easy as it might have been – but the House of Representatives on March 27 approved the sweeping $2 trillion stimulus bill that includes retirement relief provisions supported by the American Retirement Association.
The Coronavirus, Aid, Relief and Economic Security (CARES) Act (H.R. 748 as amended) is now cleared for President Trump’s expected signature, which may take place later today.
There was some added drama with the House passage. Members for the most part had been sheltering in place in their home districts amid the COVID-19 outbreak, but the leadership was forced to call lawmakers back into town under the possibility of having to take a recorded vote, instead of passing the legislation by simple voice vote. The latter was preempted by a challenge from Rep. Thomas Massie (R-Ky), who requested a recorded vote, but enough members made it back to reject that motion.
The CARES Act was passed by the Senate on March 25 in a unanimous vote of 96-0 (four senators were under quarantine).
As explained in a March 26 post, the retirement-based provisions stick closely to what was initially proposed by Senate Majority Leader Mitch McConnell (R-KY), including provisions to ease retirement plan hardship and loan rules to free up funds for individuals impacted by the pandemic and to provide relief from the required minimum distribution (RMD) rules. The final bill also adds funding relief for single employer defined benefit plans.
What’s more, it provides the Department of Labor with expanded authority to postpone certain deadlines under ERISA. In fact, the ARA has been pressing the Treasury Department and DOL for relief from certain retirement plan filing deadlines.
Student Debt Relief?
And while not directly related to retirement, section 2206 of the bill allows for an employer to make student loan repayments for employees with no tax implications. The provision extends current Internal Revenue Code Section 127 to apply to student loan repayments (Section 127 currently allows for tuition reimbursement up to $5,250 a year). More employers are increasingly interested in helping their employees with student loan repayments as a way to help their employees begin saving sooner for retirement.
ARA Presses for DC Funding Relief
In addition to the CARES Act, the ARA continues to push for defined contribution funding relief. The ARA has called on the Treasury Department to provide relief to help employers facing significant financial burdens relating to the Coronavirus, especially for retirement plans sponsored by small businesses.
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