This bill allows federal contractors, their employees, and certain federal grant recipients or District of Columbia government workers affected by government shutdowns to withdraw up to $30,000 (adjusted for inflation) from retirement plans without the usual 10% early withdrawal penalty. Withdrawals must be repaid within three years to avoid tax consequences, and the withdrawn amount is spread over three years for tax purposes. It specifically applies during periods of federal appropriations lapses (at least two weeks) when workers face unpaid leave or reduced pay. The bill modifies tax rules to treat these distributions as eligible for penalty-free access under defined circumstances.
This bill increases the size of the ERISA Advisory Council (which advises on retirement and pension laws) from 15 to 17 members. It specifically adds two new seats for representatives from employee ownership organizations (like worker-owned cooperatives), while increasing the number of pension plan representatives. The changes take effect within one year of the bill becoming law, requiring the Labor Secretary to appoint these new members. The bill directly affects the council's composition and gives employee ownership groups a formal role in advising on retirement and pension policy.
The Social Security Enhancement and Protection Act of 2025 increases benefits for low-wage workers based on years of work, with minimum benefits ranging from 36.7% for 11 years of work to 100% for 30+ years. It creates a new benefit for beneficiaries with 16+ years of coverage after eligibility, with increases from 20% to 100% based on years covered. The bill extends child benefits for full-time post-secondary students up to age 26 (previously 19), changes how high earnings are taxed with decreasing taxable percentages from 90% in 2026 to 0% after 2035, and increases Social Security tax rates for employees, employers, and self-employed individuals.
The Auto Reenroll Act of 2025 modifies retirement savings plan rules to allow automatic re-enrollment for employees who previously opted out. Specifically, it permits employers to automatically place employees back into retirement contribution plans after 1-3 years (without requiring a new election), unless the employee actively chooses to remain opted out. This applies to 401(k) plans and similar retirement arrangements, directly affecting employees who had previously declined to contribute. The law ensures plans won’t be disqualified for using this automatic re-enrollment method, streamlining participation while respecting employee choice.
The Employee Ownership Fairness Act of 2025 would adjust federal retirement rules to help employees in Employee Stock Ownership Plans (ESOPs) better manage their retirement savings. Currently, ESOP contributions tied to company growth can cause employees to exceed annual limits for other retirement plans (like 401(k)s), forcing employers to deny matching contributions they’d otherwise provide. The bill changes how contribution limits are calculated by excluding employer stock contributions and loan repayments used to buy company shares from the limits, and requires ESOPs to be treated separately from other retirement plans. This would allow ESOP participants to diversify their savings without losing access to employer matching contributions they’d otherwise miss.
This bill modifies retirement plan rules to allow automatic reenrollment for employees who previously opted out of contributions. It permits employers to automatically reinstate 401(k) and similar retirement plan contributions after 1-3 years (unless employees actively opt out again), applying to both qualified automatic contribution arrangements and eligible automatic contribution arrangements. The change affects employees in employer-sponsored retirement plans who had previously chosen not to contribute, ensuring they are automatically enrolled again without needing to reapply. The policy applies to future plan years starting after the bill's enactment, with no retroactive effect.
HR 2958, the Balance the Scales Act, requires the U.S. Department of Labor to obtain written agreements with individuals before sharing information that could be used in lawsuits against employers or pension plan sponsors. The bill mandates annual reports to Congress detailing these agreements, including redacted copies, dates, types of information shared, and communications logs, while protecting privacy. It also adds a policy finding that private pension plans are vital for employee security. The law applies to any "adverse assistance" provided on or after its enactment date.
The Independent Retirement Fairness Act (S 2217) creates new retirement savings options for independent workers - such as freelancers, gig workers, and contractors - who typically lack employer-sponsored plans. It allows these workers to join "pooled employer plans" (managed by trade associations or employers) as if they were employees, without changing their independent status, and adjusts Simplified Employee Pension (SEP) plans to include them. Key provisions let employers treat independent workers as eligible for retirement contributions, exclude them from employee count calculations for plan rules, and redirect cash bonuses into retirement savings. The bill also establishes pilot programs to automate retirement savings through rounding down payments or scheduled deductions.
HR 2972, the EITC for Older Workers Act of 2025, removes the age limit preventing workers over 65 from claiming the Earned Income Tax Credit (EITC). It amends the tax code to eliminate the requirement that recipients must be "not attained age 65," directly affecting low-to-moderate income workers aged 65 and older who were previously ineligible. The change takes effect for tax years beginning after December 31, 2025, allowing these workers to access the credit for earned income. This is a direct policy change to expand eligibility under the existing EITC program.
This bill allows employers to contribute directly to an employee's ABLE account (a savings account for people with disabilities) instead of a retirement plan, without violating retirement plan rules. It specifically ensures that when employers make these ABLE contributions, they are treated as valid contributions for retirement plan compliance purposes and do not disqualify the employee from federal benefits like Medicaid. The law requires employers to offer this option universally to all eligible ABLE account holders who participate in their retirement plans. It also clarifies that these employer contributions to ABLE accounts won't count toward income limits for means-tested federal programs. This directly affects working individuals with disabilities who use ABLE accounts to save without losing government benefits.
