Proposed Bill Would Create Portable Retirement Accounts
Representative Jim Himes (D-CT) and Senator Mark Warner (D-VA) have announced legislation to establish universal, portable retirement accounts. The Portable Retirement and Investment Account (PRIA) Act of 2021 would create such accounts for every American at birth, in conjunction with the issuance of a Social Security number.
The child of any taxpayer who received the earned income tax credit in the tax year prior to establishment of the account would also receive a $500 contribution. Any individual will be permitted to make contributions to their own account throughout their life, except during years in which they are an active participant in an employer-sponsored retirement plan. Annual aggregate contributions will be limited to an amount comparable to the IRA contribution limit imposed under Internal Revenue Code Section 219(b) and catch-up contributions for those age 50 or older.
Employers will be permitted to make direct deposits, apply automatic contribution and automatic escalation features, and make contributions to the accounts of their eligible employees. These employees are limited to anyone
- whose employer does not maintain a qualified retirement plan,
- whose employment consists of work (whether or not as an employee) through mobile platforms, or
- who is not eligible to participate in their employer’s qualified retirement plan.
The bill was referred to the House Committee on Ways and Means.