There have been prior attempts by Congress to pass similar legislation, which follows unfinished business left over from the enactment of SECURE 2.0. The new federal legislation amended the Internal Revenue Code to allow 403(b)s to invest in CITs, but changes needed under the securities law did not make it into the final bill when SECURE 2.0 was enacted in December 2022.
Last September, there was a push by Congress, led by ranking Senate Banking, Housing and Urban Affairs Committee member Sen. Tim Scott (R-SC), to include the ability for 403(b) plans to use the low-cost CIT investment options that many 401(k) plans use today. He introduced the Empowering Main Street in America Act of 2024, which would expand 403(b) plan participants’ investment options, so they have greater parity with those available in 401(k)s and other plans.
“ARA fully supports this legislation that will boost the retirement savings of hard-working employees at hospitals, universities, and other non-profit organizations,” said ARA CEO Brian Graff. “Under the bill, 15 million workers at these organizations throughout the country will now have access in their … 403(b) plan to the same lower-cost investments that are available to 401(k) plan participants.”
