STABLE Act

I 116TH CONGRESS 1ST SESSION H. R. 4795 To amend the Internal Revenue Code of 1986 to provide for employer contributions to ABLE accounts, and for other purposes. IN THE HOUSE OF REPRESENTATIVES OCTOBER 22, 2019 Ms. SLOTKIN (for herself and Mr. KELLY of Pennsylvania) introduced the following bill; which was referred to the Committee on Ways and Means A BILL To amend the Internal Revenue Code of 1986 to provide for employer contributions to ABLE accounts, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Saving To Achieve a 4 Better Life Experience Act of 2019’’ or the ‘‘STABLE 5 Act’’. 6 SEC. 2. EMPLOYER CONTRIBUTIONS TO ABLE ACCOUNTS. 7 (a) IN GENERAL.—Section 106 of the Internal Rev- 8 enue Code of 1986 is amended by adding at the end the 9 following new subsection: 10 VerDate Sep 11 2014 20:38 Oct 30, 2019 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H4795.IH H4795 pamtmann on DSKBC07HB2PROD with BILLS 2 •HR 4795 IH ‘‘(h) CONTRIBUTIONS TO ABLE ACCOUNTS.—Any 1 amounts contributed by an employee’s employer to any 2 ABLE account (as defined in section 529A) designated 3 by the employee, and of which the employee is not a bene- 4 ficiary, shall be treated as employer-provided coverage for 5 medical expenses under an accident or health plan to the 6 extent such amounts do not exceed the lesser of— 7 ‘‘(1) the amount such employee contributed 8 during the taxable year to such ABLE account (as 9 so defined), or 10 ‘‘(2) an amount equal to 1⁄2 the amount in ef- 11 fect under section 529A(b)(2)(B)(I).’’. 12 (b) FAILURE OF EMPLOYER TO MAKE COMPARABLE 13 ABLE ACCOUNT CONTRIBUTIONS.—Chapter 43 of such 14 Code is amended by adding at the end the following new 15 section: 16 ‘‘SEC. 4980J. FAILURE OF EMPLOYER TO MAKE COM- 17 PARABLE ABLE ACCOUNT CONTRIBUTIONS. 18 ‘‘(a) IN GENERAL.—In the case of an employer who 19 on behalf of an employee makes a contribution to which 20 section 106(h) applies to an ABLE account (as defined 21 in section 529A), there is hereby imposed a tax on the 22 failure of such employer to meet the requirements of sub- 23 section (b) for such calendar year. 24 VerDate Sep 11 2014 20:38 Oct 30, 2019 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H4795.IH H4795 pamtmann on DSKBC07HB2PROD with BILLS 3 •HR 4795 IH ‘‘(b) RULES AND REQUIREMENTS.—Rules and re- 1 quirements similar to the rules and requirements of sec- 2 tion 4980E shall apply for purposes of this section. 3 ‘‘(c) REGULATIONS.—The Secretary shall issue regu- 4 lations to carry out the purposes of this section.’’. 5 (c) EXCLUSION FROM EMPLOYMENT TAXES.— 6 (1) RAILROAD RETIREMENT TAX.—Section 7 3231(e) of such Code is amended by adding at the 8 end the following new paragraph: 9 ‘‘(13) ABLE ACCOUNT CONTRIBUTIONS.—The 10 term ‘compensation’ shall not include any payment 11 made on behalf of an employee if at the time of such 12 payment it is reasonable to believe that the employee 13 will be able to exclude such payment from income 14 under section 106(h).’’. 15 (2) UNEMPLOYMENT TAX.—Section 3306(b) of 16 such Code is amended by striking ‘‘or’’ at the end 17 of paragraph (19), by striking the period at the end 18 of paragraph (20) and inserting ‘‘; or’’, and by in- 19 serting after paragraph (20) the following new para- 20 graph: 21 ‘‘(21) any payment made on behalf of an em- 22 ployee if at the time of such payment it is reason- 23 able to believe that the employee will be able to ex- 24 VerDate Sep 11 2014 20:38 Oct 30, 2019 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H4795.IH H4795 pamtmann on DSKBC07HB2PROD with BILLS 4 •HR 4795 IH clude such payment from income under section 1 106(h).’’. 2 (3) WITHHOLDING TAX.—Section 3401(a) of 3 such Code is amended by striking ‘‘or’’ at the end 4 of paragraph (22), by striking the period at the end 5 of paragraph (23) and inserting ‘‘; or’’, and by in- 6 serting after paragraph (23) the following new para- 7 graph: 8 ‘‘(24) any payment made on behalf of an em- 9 ployee if at the time of such payment it is reason- 10 able to believe that the employee will be able to ex- 11 clude such payment from income under section 12 106(h).’’. 13 (4) EMPLOYER CONTRIBUTIONS REQUIRED TO 14 BE SHOWN ON W–2.—Section 6051(a) of such Code 15 is amended by striking ‘‘and’’ at the end of para- 16 graph (11), by striking the period at the end of 17 paragraph (12) and inserting ‘‘, and’’, and by insert- 18 ing after paragraph (12) the following new para- 19 graph: 20 ‘‘(13) the amount contributed to any ABLE ac- 21 count (as defined in section 529A) on behalf of such 22 employee.’’. 23 (d) REGULATIONS AND GUIDANCE.—The Secretary 24 of the Treasury shall prescribe such regulations and other 25 VerDate Sep 11 2014 20:38 Oct 30, 2019 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H4795.IH H4795 pamtmann on DSKBC07HB2PROD with BILLS 5 •HR 4795 IH guidance as are necessary to carry out the purposes of 1 the amendments made by this Act, including verification 2 by the employer of amounts an employee contributes dur- 3 ing the taxable year to an ABLE account (as defined in 4 section 529A of such Code). 5 (e) CLERICAL AMENDMENT.—The table of sections 6 for chapter 43 of such Code is amended by adding at the 7 end the following new item: 8 ‘‘Sec. 4980J. Failure of employer to make comparable ABLE account contribu- tions.’’. (f) EFFECTIVE DATE.—The amendments made by 9 this section shall apply to taxable years beginning after 10 December 31, 2019. 11 Æ VerDate Sep 11 2014 20:38 Oct 30, 2019 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6301 E:\BILLS\H4795.IH H4795 pamtmann on DSKBC07HB2PROD with BILLS