Sec. 101. Multiple employer plans
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Section 413 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection: Except as provided in paragraph (2), if a defined contribution plan to which subsection
(c)applies— is sponsored by employers all of which have both a common interest other than having adopted the plan and control of the plan, or in the case of a plan not described in subparagraph (A), has a pooled plan provider, then the plan shall not be treated as failing to meet the requirements under this title applicable to a plan described in section 401(a) or to a plan that consists of individual retirement accounts described in section 408 (including by reason of subsection
(c)thereof), whichever is applicable, merely because one or more employers of employees covered by the plan fail to take such actions as are required of such employers for the plan to meet such requirements. Paragraph
(1)shall not apply to any plan unless the terms of the plan provide that in cases of employers failing to take the actions described in paragraph (1)— the assets of the plan attributable to employees of the employer will be transferred to a plan maintained only by the employer (or its successor), to an eligible retirement plan as defined in section 402(c)(8)(B) for each individual whose account is transferred, or to any other arrangement that the Secretary determines is appropriate, unless the Secretary determines it is in the best interests of such employees to retain the assets in the plan, and the employer described in clause
(i)(and not the plan with respect to which the failure occurred or any other participating employer in such plan) shall, except to the extent provided by the Secretary, be liable for any liabilities with respect to such plan attributable to employees of the employer. If the pooled plan provider of a plan described in paragraph (1)(B) does not perform substantially all of the administrative duties which are required of the provider under paragraph (3)(A)(i) for any plan year, the Secretary, in the Secretary's own discretion, may provide that the determination as to whether the plan meets the requirements under this title applicable to a plan described in section 401(a) or to a plan that consists of individual retirement accounts described in section 408 (including by reason of subsection
(c)thereof), whichever is applicable, shall be made in the same manner as would be made without regard to paragraph (1). For purposes of this subsection— The term pooled plan provider means, with respect to any plan, a person who— is designated by the terms of the plan as a named fiduciary (as defined in section 402(a)(2) of the Employee Retirement Income Security Act of 1974), as the plan administrator, and as the person responsible to perform all administrative duties (including conducting proper testing with respect to the plan and employees of each participating employer) which are reasonably necessary to ensure that— the plan meets any requirement applicable under the Employee Retirement Income Security Act of 1974 or this title to a plan described in section 401(a) or to a plan that consists of individual retirement accounts described in section 408 (including by reason of subsection
(c)thereof), whichever is applicable, and each participating employer takes such actions as the Secretary or such person determines are necessary for the plan to meet the requirements described in subclause (I), including providing to such person any disclosures or other information which the Secretary may require or which such person otherwise determines is necessary to administer the plan or to allow the plan to meet such requirements, registers as a pooled plan provider with the Secretary, and provides such other information to the Secretary as the Secretary may require, before beginning operations as a pooled plan provider, acknowledges in writing that such person is a named fiduciary (within the meaning of section 402(a)(2) of the Employee Retirement Income Security Act of 1974), and the plan administrator, with respect to the plan, and is responsible for ensuring that all persons who handle assets of, or who are fiduciaries of, the plan are bonded in accordance with section 412 of the Employee Retirement Income Security Act of 1974. The Secretary may perform audits, examinations, and investigations of pooled plan providers as may be necessary to enforce and carry out the purposes of this subsection. The Secretary shall issue such guidance as the Secretary determines appropriate to carry out this subsection, including guidance— to identify the administrative duties and other actions required to be performed by a pooled plan provider under this subsection, which describes the procedures to be taken to terminate a plan which fails to meet the requirements to be a plan described in paragraph (1), including the proper treatment of, and actions needed to be taken by, any participating employer of the plan and the assets and liabilities of the plan with respect to employees of that employer, and identifying appropriate cases to which the rules of paragraph (2)(A) will apply to employers failing to take the actions described in paragraph (1). The Secretary shall take into account under clause
(iii)whether the failure of an employer or pooled plan provider to provide any disclosures or other information, or to take any other action, necessary to administer a plan or to allow a plan to meet requirements applicable to the plan under section 401(a) or 408, whichever is applicable, has continued over a period of time that clearly demonstrates a lack of commitment to compliance. Any guidance issued by the Secretary under this paragraph shall not apply to any action or failure occurring before the issuance of such guidance. The Secretary shall, in consultation with the Secretary of Labor when appropriate, publish model plan language which meets the requirements of this subsection and of paragraphs
(43)and
(44)of section 3 of the Employee Retirement Income Security Act of 1974 and which may be adopted in order for a plan to be treated as a plan described in paragraph (1)(B). . Paragraph
(3)of section 413(b) of such Code is amended by striking section 401(a) and inserting sections 401(a) and 408(c) . Subsection
(c)of section 408 of such Code is amended by inserting after paragraph
(2)the following new paragraph: There is a separate accounting for any interest of an employee or member (or spouse of an employee or member) in a Roth IRA. . Section 3(2) of the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1002(2) ) is amended by adding at the end the following: A pooled employer plan shall be treated as— a single employee pension benefit plan or single pension plan; and a plan to which section 210(a) applies. . Section 3 of the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1002 ) is amended by adding at the end the following: The term pooled employer plan means a plan— which is an individual account plan established or maintained for the purpose of providing benefits to the employees of 2 or more employers; which is a plan described in section 401(a) of the Internal Revenue Code of 1986 which includes a trust exempt from tax under section 501(a) of such Code or a plan that consists of individual retirement accounts described in section 408 of such Code (including by reason of subsection
(c)thereof); and the terms of which meet the requirements of subparagraph (B). Such term shall not include a plan with respect to which all of the participating employers have both a common interest other than having adopted the plan and control of the plan. The requirements of this subparagraph are met with respect to any plan if the terms of the plan— designate a pooled plan provider and provide that the pooled plan provider is a named fiduciary of the plan; designate one or more trustees meeting the requirements of section 408(a)(2) of the Internal Revenue Code of 1986 (other than a participating employer) to be responsible for collecting contributions to, and holding the assets of, the plan and require such trustees to implement written contribution collection procedures that are reasonable, diligent, and systematic; provide that each participating employer retains fiduciary responsibility for— the selection and monitoring in accordance with section 404(a) of the person designated as the pooled plan provider and any other person who, in addition to the pooled plan provider, is designated as a named fiduciary of the plan; and to the extent not otherwise delegated to another fiduciary by the pooled plan provider and subject to the provisions of section 404(c), the investment and management of that portion of the plan’s assets attributable to the employees of that participating employer; provide that a participating employer, or a participant or beneficiary, is not subject to unreasonable restrictions, fees, or penalties with regard to ceasing participation, receipt of distributions, or otherwise transferring assets of the plan in accordance with section 208 or paragraph (44)(C)(i)(II); require— the pooled plan provider to provide to participating employers any disclosures or other information which the Secretary may require, including any disclosures or other information to facilitate the selection or any monitoring of the pooled plan provider by participating employers; and each participating employer to take such actions as the Secretary or the pooled plan provider determines are necessary to administer the plan or for the plan to meet any requirement applicable under this Act or the Internal Revenue Code of 1986 to a plan described in section 401(a) of such Code or to a plan that consists of individual retirement accounts described in section 408 of such Code (including by reason of subsection
(c)thereof), whichever is applicable, including providing any disclosures or other information which the Secretary may require or which the pooled plan provider otherwise determines is necessary to administer the plan or to allow the plan to meet such requirements; and provide that any disclosure or other information required to be provided under clause
(v)may be provided in electronic form and will be designed to ensure only reasonable costs are imposed on pooled plan providers and participating employers. The term pooled employer plan does not include— a multiemployer plan; or a plan established before January 1, 2016, unless the plan administrator elects that the plan will be treated as a pooled employer plan and the plan meets the requirements of this title applicable to a pooled employer plan established on or after such date. The term pooled plan provider means a person who— is designated by the terms of a pooled employer plan as a named fiduciary, as the plan administrator, and as the person responsible for the performance of all administrative duties (including conducting proper testing with respect to the plan and employees of each participating employer) which are reasonably necessary to ensure that— the plan meets any requirement applicable under this Act or the Internal Revenue Code of 1986 to a plan described in section 401(a) of such Code or to a plan that consists of individual retirement accounts described in section 408 of such Code (including by reason of subsection
(c)thereof), whichever is applicable; and each participating employer takes such actions as the Secretary or pooled plan provider determines are necessary for the plan to meet the requirements described in subclause (I), including providing the disclosures and information described in paragraph (43)(B)(v)(II); registers as a pooled plan provider with the Secretary, and provides to the Secretary such other information as the Secretary may require, before beginning operations as a pooled plan provider; acknowledges in writing that such person is a named fiduciary, and the plan administrator, with respect to the pooled employer plan; and is responsible for ensuring that all persons who handle assets of, or who are fiduciaries of, the pooled employer plan are bonded in accordance with section 412. The Secretary may perform audits, examinations, and investigations of pooled plan providers as may be necessary to enforce and carry out the purposes of this paragraph and paragraph (43). The Secretary shall issue such guidance as the Secretary determines appropriate to carry out this paragraph and paragraph (43), including guidance— to identify the administrative duties and other actions required to be performed by a pooled plan provider under either such paragraph; and which requires in appropriate cases that if a participating employer fails to take the actions required under subparagraph (A)(i)(II)— the assets of the plan attributable to employees of the participating employer are transferred to a plan maintained only by the participating employer (or its successor), to an eligible retirement plan as defined in section 402(c)(8)(B) of the Internal Revenue Code of 1986 for each individual whose account is transferred, or to any other arrangement that the Secretary determines is appropriate in such guidance; and the participating employer described in item
(aa)(and not the plan with respect to which the failure occurred or any other participating employer in such plan) shall, except to the extent provided in such guidance, be liable for any liabilities with respect to such plan attributable to employees of the participating employer. The Secretary shall take into account under subclause
(II)whether the failure of an employer or pooled plan provider to provide any disclosures or other information, or to take any other action, necessary to administer a plan or to allow a plan to meet requirements described in subparagraph (A)(i)(II) has continued over a period of time that clearly demonstrates a lack of commitment to compliance. The Secretary may waive the requirements of subclause (II)(aa) in appropriate circumstances if the Secretary determines it is in the best interests of the employees of the participating employer described in such clause to retain the assets in the plan with respect to which the employer's failure occurred. Any guidance issued by the Secretary under this subparagraph shall not apply to any action or failure occurring before the issuance of such guidance. For purposes of this paragraph— In determining whether a person meets the requirements of this paragraph to be a pooled plan provider with respect to any plan, all persons who are members of the same controlled group and who perform services for the plan shall be treated as one person. Persons shall be treated as members of the same controlled group if such persons are treated as a single employer under subsection
(c)or
(d)of section 210. . The last sentence of section 412(a) of the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1112(a) ) is amended by inserting or in the case of a pooled employer plan (as defined in section 3(43) after section 407(d)(1)) . Section 3 of the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1002 ) is amended— in paragraph (16)(B)— by striking or at the end of clause (ii), and by striking the period at the end and inserting , or
(iv)in the case of a pooled employer plan, the pooled plan provider. ; and by striking the second paragraph (41). The amendments made by this section shall apply to years beginning after December 31, 2019. Nothing in the amendments made by subsection
(a)shall be construed as limiting the authority of the Secretary of the Treasury or the Secretary's delegate (determined without regard to such amendment) to provide for the proper treatment of a failure to meet any requirement applicable under the Internal Revenue Code of 1986 with respect to one employer (and its employees) in a multiple employer plan.
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