Retirement Savings for Americans Act of 2025
- house
- senate
- president
Last progress April 7, 2025 (8 months ago)
Introduced on April 7, 2025 by Lloyd K. Smucker
Sponsors (7)
House Votes
Referred to the Committee on Education and Workforce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Senate Votes
Presidential Signature
AI Summary
This bill creates a national retirement account, the American Worker Retirement Plan, to help working Americans build savings. Workers can be enrolled through their employer, with a default 3% of pay going in unless they opt out; independent contractors can also be enrolled by the businesses they work with. Contributions are after-tax, and withdrawals follow rules similar to a Roth IRA . A national board oversees the plan and picks investment options, including a government securities fund . The plan and its fund are established by the Act to hold and invest your savings .
The plan adds government money through a new tax credit: 1% of your income, plus a match on what you put in—100% of the first 3% of pay you contribute and 50% of the next 2%—with limits for higher incomes. The Treasury deposits this credit into your account . If your income is above a set threshold, that year’s contributions are returned to you by the plan. Money in these accounts doesn’t count against federal public aid for people under 65. You can choose cash, multiple payments, or an annuity in retirement, roll money to other plans, take a loan or a hardship withdrawal, and even send part of your tax refund into the account; spousal and survivor protections apply . If you pull out the new government match too soon (within 6 months), that match is taken back.
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Who is affected
- Workers enrolled by participating employers and sole proprietors/independent contractors who choose to enroll.
- Former participants keep their accounts but can’t add new money; they still control how it’s invested and how to take it out.
- High earners over a set limit get that year’s contributions returned.
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What changes
- Default 3% paycheck contributions with an opt-out; after-tax, Roth-like treatment .
- A government credit adds 1% of income plus matches some contributions; Treasury deposits it into your account; if withdrawn too soon, the match is forfeited .
- You may direct part of your tax refund to the account; loans, hardship withdrawals, rollovers, and small-balance cash-outs are allowed under set rules .
- Money in the account doesn’t reduce eligibility for federal public assistance if under 65.
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When
- The new tax credit applies to tax years beginning after December 31, 2024.
- Once the fund is set up, businesses have up to one year to complete enrollment for workers who are eligible at that time.