NAILBA Perspectives Perspectives Fall 2018 | Page 16

washington update
House Members Hit Campaign Trail,
Leaving Much to Do in November
The House of Representatives left
Washington September 28, freeing its
members to head home to campaign
ahead of the November 6 elections.
House lawmakers finished a number
of important initiatives—including
government funding until at least
December 7. But the House also left
a number of high-profile issues, in-
cluding three tax reform/cuts bills
(see story below), for the lame duck
session that starts November 13. The
Senate left on October 12.
B
oth the House and Sen-
ate approved government
spending legislation that
funds more than 2/3 of the federal
government for all of fiscal year (FY)
2019, and the rest through December
7, 2018. For the first time in years,
Congress agreed on funding for the
Departments of Health & Human Ser-
vices (HHS), Labor (DOL), Education,
and Defense. The agreement resulted
in part from lawmakers’ decision to
leave out of the funding bill conten-
tious policy riders—provisions that
trigger partisan struggle on such
high-profile issues as abortion and
Affordable Care Act (ACA) regulation.
Also contributing to the successful
compromise was the decision to com-
bine HHS/DOL and Defense funding
in just one bill.
Where policy disagreements could
not be resolved (or ignored), Con-
gress deferred the dispute resolution
until after the mid-term elections
by approving temporary funding (at
current year levels until December
7) for the parts of government that
were not covered by full FY 2019
appropriations legislation. Between
November 13 and December 7, the
lame-duck 115th Congress will de-
bate the most high-profile of these
issues – funding of the southern
border wall – in the Department of
Homeland Security (DHS) bill.
16 perspectives FALL 2018
Prospects: It will be the current
Congress (not the Members who will
be elected November 6) that deals
with the lame duck session issues.
Those issues are expected to be
contentious, with some key law-
makers suggesting there may be a
pre-Christmas partial government
shut- down over issues (like funding
the southern border wall) that have
so far resisted successful resolution.
As a result, the November 13-Decem-
ber 7 lame duck session will likely be
busy, with the potential for unantic-
ipated issues popping up throughout
the session.
House Passes Three Tax
Reform Bills
On September 27 and 28, the House
of Representatives passed three tax
reform bills. The bills make perma-
nent current individual tax rates,
the pass-through business income
deduction, and the doubled estate
tax exemption; expand open multi-
ple employer plans (MEPs) and make
other retirement and non- retirement
savings tax rule changes; and permit
investors in start-up businesses to
qualify for more tax incentives.
The three bills now await Senate
action. They include:
• The House passed the Protecting
Family and Small Business Tax
Cuts Act (H.R.6760) on Septem-
ber 28 by a vote of 220 to 191. It
eliminates the Tax Cuts and Jobs
Act’s (TCJA’s) expiration dates for
individual income tax rates. It also
makes permanent, by eliminating
the TCJA expiration dates, the sec-
tion 199A pass-through business
income deduction and the doubled
estate tax exemption. Also made
permanent in H.R.6760 is the in-
crease in the standard deduction,
the child tax credit, and the repeal
of the individual minimum tax.
 H.R.6760 also extends to 2021
the TCJA rule that makes unreim-
bursed medical expenses deduct-
ible to the extent they exceed 7.5
percent of adjusted gross income
(AGI). Unless extended again, as
of 2022 unreimbursed medical ex-
penses will be deductible to the
extent they exceed 10 percent of
AGI.
 The House-passed bill also
makes permanent many of the TC-
JA’s revenue- offsetting/rules-re-
forming provisions that trigger a
loss of tax incentives—including
the repeal of the personal exemp-
tion, the reduction in deductible
mortgage interest to $750,000,
the new $10,000 limit on the de-
ductibility of state and local taxes
(SALT), and others.
• The Family Savings Act (H.R.6757)
passed the House on September
27 by a vote of 240 to 177. The
bill changes both retirement and
non-retirement savings rules. It
includes 11 of the 33 provisions
contained in the NAIFA-support-
ed Retirement Enhancement and
Savings Act (RESA). Among the
RESA provisions in H.R.6757 is an
expansion of multiple employer
pension (MEP) plans, including re-
peal of the “one- bad apple” rule.
(The one bad apple rule would dis-
qualify the plan for all employers
if one employer had a disqualify-
ing event; repeal of it would mean
only the employer responsible for
the disqualification would be im-
pacted.) It also would expand the
rules for participating in a MEP
(the nexus rules) so that even
employers with no common busi-
ness connection could adopt into
a multiple employer plan.
 The bill also eliminates the age
restriction on making contribu-
tions to IRAs, eliminates the mini-
mum required distributions rule for
aggregated account balances of
less than $50,000 (indexed), and
provides fiduciary liability protec-
tion for plan sponsors that offer
a lifetime annuity option in their
plans’ menu of investment choices.
 H.R.6757 does not include the
lifetime income disclosure (LIDA)
rules supported by NAIFA—i.e.,
the provisions that would require
employers to show their plan par-
ticipants how much monthly life-
time income could be generated
by the amount they have in their
retirement plan accounts. Nor does
the contain the “stretch IRA” pro-
vision that would require distri-
bution (and tax paid) within five