Bills Aim to Clarify Church Plan Rules

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By Kristen Ricaurte Knebel

Nov. 19 — Companion bills that would clarify how to apply the tax code and retirement laws to church pension plans were introduced in the House and the Senate by a team of bipartisan lawmakers.

The bills, both called the Church Plan Clarification Act of 2015 (S. 2308, H.R. 4085), would correct several legal and regulatory issues that such pension plans face, lawmakers said in a news release Nov. 19.

Sens. Ben Cardin (D-Md.) and Rob Portman (R-Ohio), co-chairs of the Senate Retirement Security Caucus, introduced S. 2308 on Nov. 19, the same day that Reps. Pat Tiberi (R-Ohio) and Richard E. Neal (D-Mass.) introduced H.R. 4085.

“Many church plans date back to the 18th century, and our complicated tax system hasn’t always kept up with the times. More than 1 million clergy, faith institution workers, and their dependents deserve the peace of mind that comes with the financial security during retirement that we wish for every American,” Cardin said in the release.

The legislation would tackle five distinct issues, including rules on controlled groups, grandfathered defined benefit plans, automatic enrollment, transfers between 403(b) and 401(a) plans, and 81-100 trusts, the release said.

Regarding the controlled group rules, the legislation would establish “rules for aggregation of church-related entities for benefits rules and testing purposes that reflect the unique structural characteristics of religious organizations,” the release said.

The twin bills also aim to allow for mergers and transfers between 403(b) church retirement plans and 401(a) qualified church retirement plans, something that isn't permitted under current regulations.

Additionally, the legislation would allow for automatic enrollment in church plans by preempting state laws that don't permit that, the release said.

To contact the reporter on this story: Kristen Ricaurte Knebel in Washington at

To contact the editor responsible for this story: Jo-el Meyer at

Text of the bills are at: S. 2308 ( and H.R. 4085 (