James M. Jeffords: “today I am introducing S. 2329, the Retirement Portability Account (RAP) Act. This bill is a close companion to H.R.…”

“today I am introducing S. 2329, the Retirement Portability Account (RAP) Act. This bill is a close companion to H.R. 3503 introduced by our colleagues Earl Pomeroy of North Dakota and Jim Kolbe of Arizona earlier this year. In addition, it contains certain elements of H.R. 3788, the Portman-Cardin bill, which relate to increased pension portability. Generally this bill is intended to be a further iteration of the concepts embodied in both of those bills. It standardizes the rules in the Internal Revenue Code (IRC) which regulate how portable a worker's retirement savings account is, and while it does not make portability of pension benefits perfect, it greatly improves the status quo. Consistent with 'greatly improving the status quo', this bill contains no mandates. No employer will be 'required' to accept rollovers from other plans. A rollover will occur when the employee offers, and the employer agrees to accept, a rollover from another plan. Under current law, it is not possible for an individual to move an accumulated retirement savings account from a section 401(k) (for-profit) plan to a section 457 (state and local government) deferred compensation plan, to an Individual Retirement Account (IRA), then to a section 403(b) (non-profit organization) plan and ultimately back into a section 401(k) plan, without violating various restrictions on the movement of their money.”