Bill > S1840

This bill amends the Internal Revenue Code to provide a more generous tax credit for small businesses (specifically "microemployers") that start retirement pension plans for their employees. Under the new provision, microemployers—defined as businesses with 10 or fewer employees—can receive a tax credit that covers 100% of the startup costs for establishing a retirement plan, compared to the previous 50% credit. The maximum credit amount is increased from $500 to $2,500. To qualify, the employer must establish a plan that accepts matching contributions under a specific section of the tax code. The bill's changes would take effect for taxable years beginning after December 31, 2024, meaning employers can first claim the enhanced credit on their 2025 tax returns. The goal of this legislation appears to be encouraging very small businesses to offer retirement savings options to their employees by making it more financially feasible to set up such plans.

Budget and Finance

https://www.congress.gov/bill/119th-congress/senate-bill/1840/all-info