Here are 7 possible sources of Secure Act implementation uncertainty....

(Photo: Miguel.v/Wikimedia Commons)

1. Something could still go wrong in the Senate.

Probably not, but you never know.

(Photo: Mike Scarcella/ALM)

2. President Donald Trump may hold off on signing the FCAA 2020 legislation.

He might see this "must pass" bill situation as a great chance to bargain with House Democrats.

(Credit: White House)

3. The Internal Revenue Service and other agencies will have to write the regulations

Regulation writers must reconcile new laws with the old laws and regulations.

(Photo: Allison Bell/ALM)

4. Draft regulations will have to go through public comment periods.

The commenting process takes time, and it may change how new laws really work.

(Credit: Wikimedia Commons)

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5. Critics of the law or the regulations could sue someone.

Even if the plaintiffs are unsuccessful, litigation could slow implementation of a new law.

6. The November 2020 general elections could change everything.

If someone other than Donald Trump is president in January 2021, or Democrats end up with control over both the House and the Senate, the Secure Act implementation climate could get colder.

(Photo: Bridget Bennett/Bloomberg)

7. The market could reject it.

Even if Secure Act retirement implementation goes smoothly, companies will still have to figure out how to use the new rules to create viable products.

(Credit: Thinkstock)

Some life and annuity groups’ lobbyists may be starting to think about which brand of champagne they ought to try when the Setting Every Community Up for Retirement Enhancement Act of 2019 (Secure Act) becomes law.

(Related: 7 (Polite) Life and Annuity Player Whoops of Joy for the Return of the Secure Act)

Congressional leaders have put the Secure Act in Division O of House Amendment to the Senate Amendment to H.R. 1865.

H.R. 1865 began life as a law enforcement commemorative coin act bill. Congress is now using H.R. 1865 as the tugboat for pulling the 1,773-page Further Consolidated Appropriations Act, 2020 (FCAA 2020) through Congress.

Policymakers in Washington see FCAA 2020 as a “must pass” piece of legislation: If H.R. 1865 does not become law within the next few days, much of the federal government will shut down on Friday.

Groups like the American Council of Life Insurers and the National Association of Insurance and Financial Advisors have helped shape the Secure Act and lavish it with advocacy love. They have supported the bill by issuing press releases, organizing awareness campaigns, and by sending some of the best sales representatives to Capitol Hill to sell members of Congress and their aides on the need to pass the Secure Act.

The act could:

  • Create a safe harbor that employers could  use when they’re choosing group annuity issuers to support 401(k) plan lifetime income stream options.
  • Help a plan participant transfer a plan lifetime income feature from one plan to another employer-sponsored retirement plan, or to an individual retirement account (IRA).
  • Require plan sponsors to tell the participants about how much monthly retirement income their assets might produce.
  • Let people contribute to IRAs even if they are over age 70 1/2.
  • Provide much richer tax credits for small employers that start new retirement plans.
  • Allow small employers to participate in multiple employer defined contribution retirement plans, or MEPS.

But the future on Capitol Hill is always uncertain, and, even if and when the Secure Act provision in H.R. 1865 becomes law, the same groups that fought hard for passage of the law will still have to fight hard to make the Secure Act do what they were hoping it would do.

Insurers, other financial services companies, and people like you will have to fight hard to convert new rules into products that customers want to buy.

For seven reasons why the life and annuity legislative and regulatory affairs people still can’t sit back and play with their phones, see the slideshow above. (Wiggle your pointer over the first slide to make the control arrows show up.)

— Read Big Spending Bill Leaves Out Health Agent Comp Disclosure: Lamar Alexander, on ThinkAdvisor.

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