House Democrats today introduced the "AmeriSave Plan," a bill that would allow the government to annually match up to $1,000 contributed to IRAs or defined contribution plans by middle-class wage earners. The match would be contributed directly to the plan, based on income-tax filings. The legislation would also give small employers tax credits to help cover the administrative costs of setting up a new retirement plan, and provide employer tax credits to help workers obtain financial planning advice and allow companies with 401(k) plans to automatically enroll all eligible workers unless the workers opt out.
The bill would also accelerate vesting of employer matches to 401(k) retirement plans and allow individuals to directly deposit part of their tax refunds into their IRAs or other retirement plans, and encourage employees to convert their retirement plan savings into annuities when they retire. Employees would receive a tax credit to offset the administrative cost of the conversion.