A dizzying array of legislation affecting defined contribution (DC) and defined benefit (DB) plans is expected to become law later this week as part of a fiscal 2023 government spending package heading for final votes in Congress. The retirement provisions in the SECURE 2.0 Act of 2022 are intended to build on changes made by the Setting Every Community up for Retirement Enhancement (SECURE) Act of 2019 (Div. O of Pub. L. No. 116-94). Many provisions come from several widely supported House and Senate bills (HR 2954, S 4353 and S 4808), but delay a number of proposed 2023 effective dates in those bills to 2024 or later. Enactment of SECURE 2.0 will cap several years of congressional effort. Numerous stakeholders, including Mercer, have worked to educate lawmakers about the value of the employer-based retirement system and the need for many policy changes to support it. This GRIST provides a high-level summary of some key provisions in the legislation.
Provisions aimed at DC plans include:
Several DC provisions relate specifically to 403(b) plans:
Provisions targeting defined benefit (DB) pension plans include:
Senate Democrats introduced the spending package in the wee hours of Dec. 20 after weeks of intense bipartisan negotiations between leaders of both chambers. With a Dec. 23 deadline to avoid a government shutdown, the Senate is expected to approve the bill within days and send it to the House for likely final passage and President Biden’s signature.