A bipartisan bill that would provide an incentive for S corporation businesses to convert to an employee stock ownership plan structure, among other retirement-related goals, has been introduced in the House.
Reps. Ron Kind, D-Wis., Mike Kelly, R-Pa. and Jason Smith, R-Mo., unveiled the Savings for All Vocations Enhancement Act on Oct. 16. The bill would amend the Internal Revenue Code in several ways, including deferring the tax of certain sales of employer stock to ESOPs sponsored by S corporations; reducing the penalties an IRA holder can face for an "inadvertent mistake"; and allowing for 403(b) plans to utilize open multiple employer plans, according to a news release from Mr. Kind.
The 403(b) amendment would allow 403(b) plans for workers from non-profits such as hospitals, school districts and churches to pool their retirement investments together, creating better opportunities and security for their retirements, the news release said.
Stephanie Silverman, president and CEO of the Employee-owned S Corporations of America, said in the news release that in light of the ongoing economic difficulties American workers are facing, it's important that policymakers in Washington create more economic stability and opportunity. "By facilitating more ESOPs in private industry, Congressman Kind's legislation will allow even more Americans to build meaningful retirement savings and reap the benefits of employee-ownership," Ms. Silverman said.
With few days left on the legislative calendar, it is unlikely the bill will move forward in this Congress.