[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7310 Introduced in House (IH)]

<DOC>






117th CONGRESS
  2d Session
                                H. R. 7310

   To protect America's retirement security, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 31, 2022

 Mrs. McBath (for herself, Mr. Scott of Virginia, Mrs. Watson Coleman, 
Mr. Courtney, Ms. Underwood, and Ms. Manning) introduced the following 
 bill; which was referred to the Committee on Education and Labor, and 
  in addition to the Committee on Ways and Means, for a period to be 
subsequently determined by the Speaker, in each case for consideration 
  of such provisions as fall within the jurisdiction of the committee 
                               concerned

_______________________________________________________________________

                                 A BILL


 
   To protect America's retirement security, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Protecting 
America's Retirement Security Act''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Defined contribution plan fee disclosure improvements.
Sec. 3. Personal finance education portal.
Sec. 4. Increasing spousal protection under defined contribution plans.
Sec. 5. Automatic reenrollment.
Sec. 6. Employee Ownership and Participation Initiative.
Sec. 7. Refund to Rainy Day Savings Program.

SEC. 2. DEFINED CONTRIBUTION PLAN FEE DISCLOSURE IMPROVEMENTS.

    Not later than 2 years after the date of enactment of this Act, the 
Secretary of Labor shall review section 2550.404a-5 of title 29, Code 
of Federal Regulations, and explore how the content and design of the 
covered disclosures may be improved to enhance participants' 
understanding of fees and expenses as well as the cumulative effect of 
fees and expenses on retirement savings over time. As part of such 
review, the Secretary shall conduct outreach to stakeholders, including 
those representing plan sponsors and retirement plan participants.

SEC. 3. PERSONAL FINANCE EDUCATION PORTAL.

    (a) In General.--Not later than 3 years after the date of enactment 
of this Act, the Secretary of Education, in consultation with the 
Director of the Bureau of Consumer Financial Protection, the Secretary 
of the Treasury as chair of the Financial Literacy and Education 
Commission, and the Commissioner of Internal Revenue, shall create a 
personal finance education portal on a centralized and publicly 
available website of the Department of Education pertaining to Federal 
financial aid for voluntary use by recipients of aid awarded under 
title IV of the Higher Education Act of 1965.
    (b) Content of Personal Finance Education Portal.--The personal 
finance education portal created under subsection (a) shall include 
information on personal finance concepts, including the following:
            (1) Core personal finance concepts, such as earning, 
        saving, investing, spending, and borrowing, including--
                    (A) the concept of compound growth as it applies to 
                savings and retirement savings, with information about 
                the different types of retirement savings accounts; and
                    (B) budgeting and credit usage.
            (2) Managing student loan repayment, including--
                    (A) the interaction between savings and retirement 
                decisions and Federal student loan repayment plans;
                    (B) Federal student loan discharge or forgiveness 
                options;
                    (C) the types of voluntary benefits employers may 
                use to help workers while they are paying down student 
                loan debt;
                    (D) tax credits or deductions that are relevant to 
                student loan borrowers in repayment; and
                    (E) any other Federal policies that significantly 
                impact student loan borrowers in repayment, as 
                determined by the Secretary.
            (3) Any other personal finance concepts determined relevant 
        by the Secretary of Education, in consultation with the 
        Director of the Bureau of Consumer Financial Protection, the 
        Secretary of the Treasury as chair of the Financial Literacy 
        and Education Commission, and the Commissioner of Internal 
        Revenue.
    (c) Provision of Content.--The personal finance content included 
under subsection (b) may be provided in an interactive format through 
text or video.
    (d) Analytics.--The Secretary of Education, in consultation with 
the Director of the Bureau of Consumer Financial Protection, the 
Secretary of the Treasury as chair of the Financial Literacy and 
Education Commission, and the Commissioner of Internal Revenue, shall 
review not less than once every three years the utilization of the 
portal, make recommendations to improve the portal, and make such 
findings and recommendations publicly available.
    (e) Authorization of Appropriations.--There are authorized to be 
appropriated such sums as may be necessary to carry out this section.

SEC. 4. INCREASING SPOUSAL PROTECTION UNDER DEFINED CONTRIBUTION PLANS.

    (a) Amendments to Employee Retirement Income Security Act of 
1974.--
            (1) In general.--Part 2 of subtitle B of title I of the 
        Employee Retirement Income Security Act of 1974 (29 U.S.C. 1051 
        et seq.) is amended by inserting after section 205 the 
        following new section:

``SEC. 205A. ADDITIONAL SPOUSAL CONSENT REQUIREMENTS.

    ``(a) In General.--Each individual account plan to which section 
205 does not apply (but to which this title otherwise applies) shall 
provide that, except as provided in subsections (c) and (d), no 
distribution may be made under the plan unless the spousal consent 
requirements of subsection (e) are met.
    ``(b) Coordination With Section 205.--Nothing in this section shall 
be construed to exempt an individual account plan from the requirements 
of paragraph (1)(B), (1)(C), or (2) of section 205(b) with respect to 
any participant.
    ``(c) Exceptions for Certain Distributions.--Subsection (a) shall 
not apply to--
            ``(1) any distribution that is--
                    ``(A) a minimum required distribution described in 
                section 4974(b) of the Internal Revenue Code of 1986; 
                or
                    ``(B) permitted under section 203(e)(1) to be made 
                without the consent of the participant;
            ``(2) any distribution in the form of a qualified joint and 
        survivor annuity (as defined in section 205(d)(1)), a qualified 
        optional survivor annuity (as defined in section 205(d)(2)), a 
        qualified preretirement survivor annuity (as defined in section 
        205(e)), or a series of substantially equal periodic payments 
        (not less frequently than annually) made for the joint lives 
        (or life expectancies) of the participant and the participant's 
        spouse; or
            ``(3) in the case of a participant who does not elect a 
        form of benefit described in paragraph (2) under the plan or 
        who is participating in a plan that does not provide such a 
        form of benefit, any distribution of the participant's entire 
        nonforfeitable accrued benefit if 50 percent of such accrued 
        benefit is transferred to an individual retirement plan (as 
        defined in section 7701(a)(37) of the Internal Revenue Code of 
        1986) of the spouse of the participant.
A transfer described in paragraph (3) to an individual retirement plan 
shall be treated in the same manner as a transfer under section 
408(d)(6) of the Internal Revenue Code of 1986.
    ``(d) Exceptions for Certain Rollover Contributions.--
            ``(1) In general.--Subsection (a) shall not apply to any 
        distribution that is an eligible rollover distribution (as 
        defined in section 402(f)(2)(A) of the Internal Revenue Code of 
        1986) made in the form of a direct trustee-to-trustee transfer 
        within the meaning of section 401(a)(31) of the Internal 
        Revenue Code of 1986--
                    ``(A) to a plan to which this section or section 
                205 applies; or
                    ``(B) to an individual retirement plan (as defined 
                in section 7701(a)(37) of the Internal Revenue Code of 
                1986) if--
                            ``(i) the sole beneficiary of such plan is 
                        the spouse of the participant, or the spousal 
                        consent requirements of subsection (e) are met 
                        with respect to any designation of 1 or more 
                        other beneficiaries; and
                            ``(ii) under the terms of the individual 
                        retirement plan, the beneficiary of such plan 
                        (whether the spouse or other beneficiary 
                        designated under subparagraph (A)) may not be 
                        changed unless--
                                    ``(I) the spousal consent 
                                requirements of subsection (e) are met 
                                with respect to any such change; or
                                    ``(II) the spousal consent under 
                                clause (i) to the designation of a 
                                beneficiary other than the spouse 
                                expressly permits such designation to 
                                be changed without the further consent 
                                of the spouse.
            ``(2) Regulatory authority.--The Secretary of the Treasury 
        and the Secretary of Labor may jointly issue regulations to 
        implement subparagraphs (A) and (B) of paragraph (1).
    ``(e) Spousal Consent Requirements.--
            ``(1) In general.--For purposes of this section, except as 
        provided in paragraph (2), the spousal consent requirements of 
        this subsection are met with respect to any distribution or any 
        designation or change of beneficiary if--
                    ``(A) the plan provides to each participant, within 
                a reasonable period of time before such distribution or 
                designation or change of beneficiary is made and 
                consistent with such regulations as the Secretary of 
                the Treasury may prescribe, a written explanation of 
                the rights of the participant and the participant's 
                spouse under this section;
                    ``(B) the spouse of the participant consents in 
                writing to the distribution or designation or change of 
                beneficiary;
                    ``(C) in the case of a distribution, the written 
                consent under subparagraph (B) is made during the 
                consent period; and
                    ``(D) the written consent under subparagraph (B)--
                            ``(i) acknowledges the effect of such 
                        distribution or designation or change of 
                        beneficiary; and
                            ``(ii) is witnessed by a plan 
                        representative or a notary public.
            ``(2) Exceptions.--The requirements of paragraph (1) (other 
        than subparagraph (A) thereof) shall not apply with respect to 
        any distribution or designation or change of beneficiary if a 
        participant establishes to the satisfaction of the 
        administrator that--
                    ``(A) there is no spouse;
                    ``(B) the participant and the participant's spouse 
                have not been married for at least 1 year as of the 
                date of the distribution or designation or change of 
                beneficiary; or
                    ``(C) such consent cannot be obtained because--
                            ``(i) the spouse cannot be located after 
                        taking documented search efforts in accordance 
                        with guidance from the Secretary of Labor;
                            ``(ii) due to exceptional circumstances, 
                        requiring the participant to seek the spouse's 
                        consent would be inappropriate; or
                            ``(iii) of such other circumstances as the 
                        Secretary of the Treasury, in consultation with 
                        the Secretary of Labor, may by regulations 
                        prescribe.
        The Secretary of Labor may issue regulations to implement this 
        paragraph.
            ``(3) Consent limited to spouse and event.--Any written 
        consent by a spouse under paragraph (1), or the establishment 
        by a participant that an exception under paragraph (2) applies 
        with respect to a spouse, shall be effective only with respect 
        to that spouse and to the distribution or designation or change 
        of beneficiary to which it relates.
            ``(4) Consent period.--For purposes of this subsection, the 
        term `consent period' means, with respect to any distribution--
                    ``(A) the 90-day period immediately preceding the 
                date of such distribution; or
                    ``(B) such other period as the Secretary of the 
                Treasury may provide.
    ``(f) Discharge of Plan From Liability.--Rules similar to the rules 
of section 205(c)(6) shall apply for purposes of this section.''.
            (2) Clerical amendment.--The table of sections of part 2 of 
        subtitle B of title I of the Employee Retirement Income 
        Security Act of 1974 is amended by inserting after the item 
        relating to section 205 the following new item:

``Sec. 205A. Additional spousal consent requirements.''.
            (3) Parallel amendment to section 205.--Section 
        205(c)(2)(B) of the Employee Retirement Income Security Act of 
        1974 (29 U.S.C. 1055(c)(2)(B)) is amended by inserting ``, 
        because due to exceptional circumstances, requiring the 
        participant to seek the spouse's consent would be 
        inappropriate'' after ``located''.
    (b) Conforming Amendment to Internal Revenue Code of 1986.--Section 
401(a) of the Internal Revenue Code of 1986 is amended by inserting 
after paragraph (17) the following new paragraph:
            ``(18) Additional spousal consent requirements.--
                    ``(A) In general.--To the extent paragraph (11) 
                does not apply to a defined contribution plan to which 
                title I of the Employee Retirement Income Security Act 
                of 1974 applies, except as provided in subparagraphs 
                (C) and (D), a trust forming part of such plan shall 
                not constitute a qualified trust under this section 
                unless no distribution may be made under the plan 
                unless the spousal consent requirements of subparagraph 
                (E) are met.
                    ``(B) Coordination with paragraph (11).--Nothing in 
                this paragraph shall be construed to exempt a defined 
                contribution plan from the requirements of subparagraph 
                (B)(ii), (B)(iii), or (C) of paragraph (11) with 
                respect to any participant.
                    ``(C) Exceptions for certain distributions.--
                Subparagraph (A) shall not apply to--
                            ``(i) any distribution that is--
                                    ``(I) a minimum required 
                                distribution described in section 
                                4974(b), or
                                    ``(II) permitted under section 
                                411(a)(11) to be made without the 
                                consent of the participant,
                            ``(ii) any distribution in the form of a 
                        qualified joint and survivor annuity (as 
                        defined in section 417(b)), a qualified 
                        optional survivor annuity (as defined in 
                        section 417(g)), a qualified preretirement 
                        survivor annuity (as defined in section 
                        417(c)), or a series of substantially equal 
                        periodic payments (not less frequently than 
                        annually) made for the joint lives (or life 
                        expectancies) of the participant and the 
                        participant's spouse, or
                            ``(iii) in the case of a participant who 
                        does not elect a form of benefit described in 
                        clause (ii) under the plan or who is 
                        participating in a plan that does not provide 
                        such a form of benefit, any distribution of the 
                        participant's entire nonforfeitable accrued 
                        benefit if 50 percent of such accrued benefit 
                        is directly transferred to an individual 
                        retirement plan of the spouse of the 
                        participant.
                A transfer described in clause (iii) to an individual 
                retirement plan shall be treated in the same manner as 
                a transfer under section 408(d)(6) and shall be deemed 
                not to violate paragraph (2) or (13).
                    ``(D) Exceptions for certain rollover 
                contributions.--
                            ``(i) In general.--Subparagraph (A) shall 
                        not apply to any distribution, involving a 
                        participant who has a spouse, that is an 
                        eligible rollover distribution (as defined in 
                        section 402(f)(2)(A)) made in the form of a 
                        direct trustee-to-trustee transfer within the 
                        meaning of paragraph (31)--
                                    ``(I) to a plan to which this 
                                paragraph or paragraph (11) applies; or
                                    ``(II) to an individual retirement 
                                plan if--
                                            ``(aa) the sole beneficiary 
                                        of such plan is the spouse of 
                                        the participant, or the spousal 
                                        consent requirements of 
                                        subparagraph (E) are met with 
                                        respect to any designation of 1 
                                        or more other beneficiaries; 
                                        and
                                            ``(bb) under the terms of 
                                        the individual retirement plan, 
                                        the beneficiary of such plan 
                                        (whether the spouse or other 
                                        beneficiary designated under 
                                        clause (i)) may not be changed 
                                        unless--

                                                    ``(AA) the spousal 
                                                consent requirements of 
                                                subparagraph (E) are 
                                                met with respect to any 
                                                such change, or

                                                    ``(BB) the spousal 
                                                consent under subclause 
                                                (I) to the designation 
                                                of a beneficiary other 
                                                than the spouse 
                                                expressly permits such 
                                                designation to be 
                                                changed without the 
                                                further consent of the 
                                                spouse.

                            ``(ii) Regulatory authority.--The Secretary 
                        of the Treasury, in consultation with the 
                        Secretary of Labor, may issue regulations to 
                        implement subparagraphs subclauses (I) and (II) 
                        or clause (i).
                    ``(E) Spousal consent requirements.--
                            ``(i) In general.--For purposes of this 
                        paragraph, except as provided in clause (ii), 
                        the spousal consent requirements of this 
                        subparagraph are met with respect to any 
                        distribution or any designation or change of 
                        beneficiary if--
                                    ``(I) the plan provides to each 
                                participant, within a reasonable period 
                                of time before such distribution or 
                                designation or change of beneficiary is 
                                made and consistent with such 
                                regulations as the Secretary may 
                                prescribe, a written explanation of the 
                                rights of the participant and the 
                                participant's spouse under this 
                                paragraph,
                                    ``(II) the spouse of the 
                                participant consents in writing to the 
                                distribution or designation or change 
                                of beneficiary,
                                    ``(III) in the case of a 
                                distribution, the written consent under 
                                subclause (II) is made during the 
                                consent period, and
                                    ``(IV) the written consent under 
                                subclause (ii)--
                                            ``(aa) acknowledges the 
                                        effect of such distribution or 
                                        designation or change of 
                                        beneficiary, and
                                            ``(bb) is witnessed by a 
                                        plan representative or a notary 
                                        public.
                            ``(ii) Exceptions under section 
                        417(a)(2)(b) to apply.--The requirements of 
                        clause (i) (other than subclause (I) thereof) 
                        shall not apply with respect to any 
                        distribution or designation or change of 
                        beneficiary if a participant establishes to the 
                        satisfaction of the administrator that--
                                    ``(I) there is no spouse,
                                    ``(II) the participant and the 
                                participant's spouse have not been 
                                married for at least 1 year as of the 
                                date of the distribution or designation 
                                or change of beneficiary, or
                                    ``(III) such consent cannot be 
                                obtained because--
                                            ``(aa) the spouse cannot be 
                                        located after taking documented 
                                        search efforts in accordance 
                                        with guidance from the 
                                        Secretary of Labor;
                                            ``(bb) due to exceptional 
                                        circumstances, requiring the 
                                        participant to seek the 
                                        spouse's consent would be 
                                        inappropriate; or
                                            ``(cc) of such other 
                                        circumstances as the Secretary, 
                                        in consultation with the 
                                        Secretary of Labor, may by 
                                        regulations prescribe.
                        The Secretary, in consultation with the 
                        Secretary of Labor, may issue regulations to 
                        implement this clause.
                            ``(iii) Consent limited to spouse and 
                        event.--Any written consent by a spouse under 
                        clause (i), or the establishment by a 
                        participant that an exception under clause (ii) 
                        applies with respect to a spouse, shall be 
                        effective only with respect to that spouse and 
                        to the distribution or designation or change of 
                        beneficiary to which it relates.
                            ``(iv) Consent period.--For purposes of 
                        this subparagraph, the term `consent period' 
                        means, with respect to any distribution--
                                    ``(I) the 90-day period immediately 
                                preceding the date of such 
                                distribution, or
                                    ``(II) such other period as the 
                                Secretary may provide.''.

SEC. 5. AUTOMATIC REENROLLMENT.

    (a) Eligible Automatic Contribution Arrangements.--
            (1) Amendment to the employee retirement income security 
        act of 1974.--Section 514(e)(2) of the Employee Retirement 
        Income Security Act of 1974 (29 U.S.C. 1144(e)(2)) is amended--
                    (A) by redesignating subparagraphs (A) through (C) 
                as clauses (i) through (iii), respectively, and moving 
                the margins of such clauses 2 ems to the right,
                    (B) by striking ``(2) For purposes of'' and 
                inserting ``(2)(A) For purposes of'', and
                    (C) by adding at the end the following:
                    ``(B) In the case of an automatic contribution 
                arrangement taking effect after December 31, 2024, the 
                requirements of subparagraph (A)(ii) shall be treated 
                as met only if, under the arrangement, at least every 3 
                years each employee--
                            ``(i) who is eligible to participate in the 
                        arrangement, and
                            ``(ii) who, at the time of the 
                        determination, has in effect an affirmative 
                        election pursuant to subparagraph (A)(ii) not 
                        to have contributions described in such 
                        subparagraph made,
                is treated as having made the election at the uniform 
                percentage of compensation described in subparagraph 
                (A)(ii) unless the employee makes a new election under 
                such subparagraph. Such determination may be made at 
                one time for all employees described in the preceding 
                sentence for a plan year, regardless of individual 
                employee dates of enrollment.''.
            (2) Amendment to the internal revenue code of 1986.--
        Section 414(w)(3) of the Internal Revenue Code of 1986 is 
        amended--
                    (A) by redesignating subparagraphs (A) through (C) 
                as clauses (i) through (iii), respectively, and moving 
                the margins of such clauses 2 ems to the right;
                    (B) by striking `` For purposes of'' and inserting 
                the following:
                    ``(A) In general.--For purposes of''
                    (C) by adding at the end the following new 
                subparagraph:
                    ``(B) Periodic automatic deferral required.--In the 
                case of an eligible automatic contribution arrangement 
                taking effect after December 31, 2024, the requirements 
                of this subsection shall be treated as met only if, 
                under the arrangement, at least every 3 plan years each 
                employee--
                            ``(i) who is eligible to participate in the 
                        arrangement, and
                            ``(ii) who, at the time of the 
                        determination, has in effect an affirmative 
                        election under subparagraph (A)(ii) not to have 
                        such contributions described in such 
                        subparagraph made,
                is treated as having made the election at the uniform 
                percentage level described in subparagraph (A)(ii) 
                unless the employee makes a new election under such 
                subparagraph. Such determination may be made at one 
                time for all employees described in the preceding 
                sentence for a plan year, regardless of individual 
                employee dates of enrollment.''
    (b) Qualified Automatic Contribution Arrangements.--
            (1) In general.--Section 401(k)(13)(C) of the Internal 
        Revenue Code of 1986 is amended by adding at the end the 
        following new clause:
                            ``(v) Periodic automatic deferral required 
                        for post-2024 arrangements.--In the case of a 
                        qualified automatic contribution arrangement 
                        which takes effect after December 31, 2024, the 
                        requirements of this subparagraph shall be 
                        treated as met only if, under the arrangement, 
                        at least every 3 plan years each employee--
                                    ``(I) who is eligible to 
                                participate in the arrangement, and
                                    ``(II) who, at the time of the 
                                determination, has in effect an 
                                affirmative election pursuant to clause 
                                (ii) not to have contributions 
                                described in clause (i) made,
                        is treated as having made the election 
                        described in clause (i) unless the employee 
                        makes a new affirmative election under clause 
                        (ii). Such determination may be made at one 
                        time for all employees described in the 
                        preceding sentence for a plan year, regardless 
                        of individual employee dates of enrollment.''
            (2) Conforming amendments.--Clause (iv) of section 
        401(k)(13)(C) of such Code is amended--
                    (A) in the heading, by inserting ``for pre-2025 
                arrangements'' after ``required''; and
                    (B) by striking ``Clause (i)'' and inserting ``In 
                the case of a qualified automatic contribution 
                arrangement in effect before January 1, 2025, clause 
                (i)''.
    (c) Effective Date.--The amendments made by this section shall 
apply to arrangements taking effect after December 31, 2024.

SEC. 6. EMPLOYEE OWNERSHIP AND PARTICIPATION INITIATIVE.

    (a) Definitions.--In this section:
            (1) Existing program.--The term ``existing program'' means 
        a program, designed to promote employee ownership and employee 
        participation in business decisionmaking, that exists on the 
        date on which the Secretary is carrying out a responsibility 
        authorized under this section.
            (2) Initiative.--The term ``Initiative'' means the Employee 
        Ownership and Participation Initiative established under 
        subsection (b).
            (3) New program.--The term ``new program'' means a program, 
        designed to promote employee ownership and employee 
        participation in business decisionmaking, that does not exist 
        on the date on which the Secretary is carrying out a 
        responsibility authorized under this section.
            (4) Secretary.--The term ``Secretary'' means the Secretary 
        of Labor.
            (5) State.--The term ``State'' has the meaning given the 
        term under section 3 of the Workforce Innovation and 
        Opportunity Act (29 U.S.C. 3102).
    (b) Employee Ownership and Participation Initiative.--
            (1) Establishment.--The Secretary of Labor shall establish 
        within the Department of Labor an Employee Ownership and 
        Participation Initiative to promote employee ownership and 
        employee participation in business decisionmaking.
            (2) Functions.--In carrying out the Initiative, the 
        Secretary shall--
                    (A) support within the States existing programs 
                designed to promote employee ownership and employee 
                participation in business decisionmaking; and
                    (B) facilitate within the States the formation of 
                new programs designed to promote employee ownership and 
                employee participation in business decisionmaking.
            (3) Duties.--To carry out the functions enumerated in 
        paragraph (2), the Secretary shall--
                    (A) support new programs and existing programs by--
                            (i) making Federal grants authorized under 
                        subsection (d); and
                            (ii) acting as a clearinghouse on 
                        techniques employed by new programs and 
                        existing programs within the States, and 
                        disseminating information relating to those 
                        techniques to the programs; and
                    (B) facilitate the formation of new programs, in 
                ways that include holding or funding an annual 
                conference of representatives from States with existing 
                programs, representatives from States developing new 
                programs, and representatives from States without 
                existing programs.
    (c) Programs Regarding Employee Ownership and Participation.--
            (1) Establishment of program.--Not later than 180 days 
        after the date of enactment of this Act, the Secretary shall 
        establish a program to encourage new programs and existing 
        programs within the States to foster employee ownership and 
        employee participation in business decisionmaking throughout 
        the United States.
            (2) Purpose of program.--The purpose of the program 
        established under paragraph (1) is to encourage new and 
        existing programs within the States that focus on--
                    (A) providing education and outreach to inform 
                employees and employers about the possibilities and 
                benefits of employee ownership, business ownership 
                succession planning, and employee participation in 
                business decisionmaking, including providing 
                information about financial education, employee teams, 
                open-book management, and other tools that enable 
                employees to share ideas and information about how 
                their businesses can succeed;
                    (B) providing technical assistance to assist 
                employee efforts to become business owners, to enable 
                employers and employees to explore and assess the 
                feasibility of transferring full or partial ownership 
                to employees, and to encourage employees and employers 
                to start new employee-owned businesses; and
                    (C) training employees and employers with respect 
                to methods of employee participation in open-book 
                management, work teams, committees, and other 
                approaches for seeking greater employee input.
            (3) Program details.--The Secretary may include, in the 
        program established under paragraph (1), provisions that--
                    (A) in the case of activities described in 
                paragraph (2)(A)--
                            (i) target key groups, such as retiring 
                        business owners, senior managers, unions, trade 
                        associations, community organizations, and 
                        economic development organizations;
                            (ii) encourage cooperation in the 
                        organization of workshops and conferences; and
                            (iii) prepare and distribute materials 
                        concerning employee ownership and 
                        participation, and business ownership 
                        succession planning;
                    (B) in the case of activities described in 
                paragraph (2)(B)--
                            (i) provide preliminary technical 
                        assistance to employee groups, managers, and 
                        retiring owners exploring the possibility of 
                        employee ownership;
                            (ii) provide for the performance of 
                        preliminary feasibility assessments;
                            (iii) assist in the funding of objective 
                        third-party feasibility studies and preliminary 
                        business valuations, and in selecting and 
                        monitoring professionals qualified to conduct 
                        such studies; and
                            (iv) provide a data bank to help employees 
                        find legal, financial, and technical advice in 
                        connection with business ownership;
                    (C) in the case of activities described in 
                paragraph (2)(C)--
                            (i) provide for courses on employee 
                        participation; and
                            (ii) provide for the development and 
                        fostering of networks of employee-owned 
                        companies to spread the use of successful 
                        participation techniques; and
                    (D) in the case of training described in paragraph 
                (2)(D)--
                            (i) provide for visits to existing programs 
                        by staff from new programs receiving funding 
                        under this section; and
                            (ii) provide materials to be used for such 
                        training.
            (4) Guidance.--The Secretary shall issue formal guidance, 
        for recipients of grants awarded under subsection (d) and one-
        stop partners (as defined in section 3 of the Workforce 
        Innovation and Opportunity Act (29 U.S.C. 3102)) affiliated 
        with the workforce development systems (as so defined) of the 
        States, proposing that programs and other activities funded 
        under this section be--
                    (A) proactive in encouraging actions and activities 
                that promote employee ownership of, and participation 
                in, businesses; and
                    (B) comprehensive in emphasizing both employee 
                ownership of, and participation in, businesses so as to 
                increase productivity and broaden capital ownership.
    (d) Grants.--
            (1) In general.--In carrying out the program established 
        under subsection (c), the Secretary may make grants to States 
        (except as provided in paragraph (5)) for use in connection 
        with new programs and existing programs within a State for--
                    (A) education and outreach as provided in 
                subsection (c)(2)(A);
                    (B) technical assistance as provided in subsection 
                (c)(2)(B);
                    (C) training activities for employees and employers 
                as provided in subsection (c)(2)(C);
                    (D) activities facilitating cooperation among 
                employee-owned firms; and
                    (E) training as provided in subsection (c)(2)(D) 
                for new programs provided by participants in existing 
                programs dedicated to the objectives of this section, 
                except that, for each fiscal year, the amount of the 
                grants made for such training shall not exceed 10 
                percent of the total amount of the grants made under 
                this section.
            (2) Amounts and conditions.--The Secretary shall determine 
        the amount and any conditions for a grant made under this 
        subsection. The amount of the grant shall be subject to 
        paragraph (6), and shall reflect the capacity of the applicant 
        for the grant.
            (3) Applications.--Each entity desiring a grant under this 
        subsection shall submit an application to the Secretary at such 
        time, in such manner, and accompanied by such information as 
        the Secretary may reasonably require.
            (4) State applications.--Each State may sponsor and submit 
        an application under paragraph (3) on behalf of any local 
        entity consisting of a unit of State or local government, 
        State-supported institution of higher education, or nonprofit 
        organization, meeting the requirements of this section.
            (5) Applications by entities.--
                    (A) Entity applications.--If a State fails to 
                support or establish a program pursuant to this section 
                during any fiscal year, the Secretary shall, in the 
                subsequent fiscal years, allow local entities described 
                in paragraph (4) from that State to make applications 
                for grants under paragraph (3) on their own initiative.
                    (B) Application screening.--In any case in which a 
                local entity makes an application for a grant pursuant 
                to subparagraph (A), the relevant State may take no 
                actions to screen such application.
            (6) Limitations.--A recipient of a grant made under this 
        subsection shall not receive, during a fiscal year, in the 
        aggregate, more than the following amounts:
                    (A) For fiscal year 2023, $300,000.
                    (B) For fiscal year 2024, $330,000.
                    (C) For fiscal year 2025, $363,000.
                    (D) For fiscal year 2026, $399,300.
                    (E) For fiscal year 2027, $439,200.
            (7) Annual report.--For each year, each recipient of a 
        grant under this subsection shall submit to the Secretary a 
        report describing how grant funds allocated pursuant to this 
        subsection were expended during the 12-month period preceding 
        the date of the submission of the report.
    (e) Evaluations.--The Secretary is authorized to reserve not more 
than 10 percent of the funds appropriated for a fiscal year to carry 
out this section for the purposes of conducting evaluations of the 
grant programs identified in subsection (d) and to provide related 
technical assistance.
    (f) Reporting.--Not later than 36 months after the date of 
enactment of this Act, the Secretary shall prepare and submit to 
Congress a report--
            (1) on progress related to employee ownership and 
        participation in businesses in the United States; and
            (2) containing an analysis of critical costs and benefits 
        of activities carried out under this section.
    (g) Authorizations of Appropriations.--
            (1) In general.--There are authorized to be appropriated 
        for the purpose of making grants pursuant to subsection (d) the 
        following:
                    (A) For fiscal year 2023, $4,000,000.
                    (B) For fiscal year 2024, $7,000,000.
                    (C) For fiscal year 2025, $10,000,000.
                    (D) For fiscal year 2026, $13,000,000.
                    (E) For fiscal year 2027, $16,000,000.
            (2) Administrative expenses.--There are authorized to be 
        appropriated for the purpose of funding the administrative 
        expenses related to the Initiative, for each of fiscal years 
        2022 through 2026, an amount not in excess of the lesser of--
                    (A) $350,000; or
                    (B) 5.0 percent of the maximum amount available 
                under paragraph (1) for that fiscal year.

SEC. 7. REFUND TO RAINY DAY SAVINGS PROGRAM.

    (a) Establishment.--
            (1) In general.--Not later than December 31, 2024, the 
        Secretary of the Treasury or the Secretary's delegate (referred 
        to in this subsection as the ``Secretary'') shall establish and 
        implement a program (referred to in this subsection as the 
        ``Refund to Rainy Day Savings Program'') to allow participating 
        taxpayers, pursuant to the requirements established under this 
        section, to defer payment on 20 percent of the amount which 
        would otherwise be refunded to such taxpayer as an overpayment 
        (as described in section 6401 of the Internal Revenue Code of 
        1986).
            (2) Period of deferral.--Except as provided under paragraph 
        (3)(E), a participating taxpayer may elect to defer payment of 
        the amount described in paragraph (1) and have such amount 
        deposited in the Rainy Day Fund (as described in paragraph 
        (3)).
            (3) Rainy day fund.--
                    (A) In general.--The Secretary shall establish in 
                the Treasury a fund, in such manner as the Secretary 
                determines to be appropriate, to be known as the 
                ``Rainy Day Fund'', consisting of any amounts described 
                in paragraph (1) on which payment has been deferred by 
                participating taxpayers.
                    (B) Investment.--Any amounts deposited in the Rainy 
                Day Fund shall be invested by the Secretary, in United 
                States Treasury securities issued under chapter 31 of 
                title 31, United States Code, that are suitable for the 
                needs of the Rainy Day Fund.
                    (C) Disbursements from fund.--
                            (i) In general.--On the date that is 180 
                        days after the date of deposit in the Rainy Day 
                        Fund of an amount deferred by such taxpayer 
                        under paragraph (1), the amounts in the Rainy 
                        Day Fund shall be made available to the 
                        Secretary to distribute to such taxpayer in an 
                        amount equal to such amount plus any interest 
                        accrued on such amount (as determined under 
                        subparagraph (D)).
                            (ii) Distributed to taxpayers.--The amounts 
                        described in clause (i) shall be distributed to 
                        the account identified by the participating 
                        taxpayer under paragraph (4)(B).
                    (D) Interest accrued.--The amount of interest 
                accrued on the amount deferred by a participating 
                taxpayer under subsection (a) shall be determined by 
                the Secretary based upon the return on the investment 
                of such amounts under subparagraph (B).
                    (E) Early withdrawal.--
                            (i) In general.--As soon as possible after 
                        receipt by the Secretary of the individual 
                        income tax return of the participating taxpayer 
                        and October 15 of the applicable year, such 
                        taxpayer may elect to terminate the deferral of 
                        the amount described under paragraph (1) and 
                        receive a distribution from the Rainy Day Fund 
                        equal to such amount and any interest which has 
                        accrued on such amount up to that date.
                            (ii) Complete withdrawal.--A participating 
                        taxpayer making an election under clause (i) 
                        must terminate deferral of the full amount 
                        described under paragraph (1), and such amount 
                        shall be distributed to the bank account 
                        identified by the participating taxpayer under 
                        paragraph (4)(B).
            (4) Participating taxpayer.--For purposes of this section, 
        the term ``participating taxpayer'' means a taxpayer who--
                    (A) prior to the due date for filing the return of 
                tax for such taxable year, elects to participate in the 
                Refund to Rainy Day Savings Program, in accordance with 
                regulations to be issued by the Secretary; and
                    (B) provides the Secretary with an account and 
                routing number or any other financial information 
                deemed necessary by the Secretary for purposes of 
                subparagraphs (C)(ii) and (E)(ii) of paragraph (3).
            (5) Forms.--The Secretary shall ensure that the election to 
        defer payment of the amount described in paragraph (1) may be 
        claimed on appropriate tax forms.
            (6) Implementation.--
                    (A) Educational materials and outreach.--The 
                Secretary shall--
                            (i) design educational materials for 
                        taxpayers regarding financial savings and the 
                        Refund to Rainy Day Savings Program,
                            (ii) publicly disseminate and distribute 
                        such materials during the first calendar 
                        quarter of each calendar year and following 
                        disbursement of amounts described in paragraph 
                        (3)(C), and
                            (iii) engage in outreach regarding the 
                        Refund to Rainy Day Savings Program to the 
                        Volunteer Income Tax Assistance program and 
                        paid tax preparers.
                    (B) Information for participating taxpayers.--The 
                Secretary shall ensure that a participating taxpayer is 
                able to electronically verify the status of the amount 
                deferred by such taxpayer under paragraph (1), 
                including any interest accrued on such amount and the 
                status of any distribution.
                    (C) Federally funded benefits.--Any amounts 
                described in paragraph (1) that are distributed to a 
                participating taxpayer, including any interest accrued 
                on such amount, shall be treated in the same manner as 
                any refund made to such taxpayer under section 32 of 
                the Internal Revenue Code of 1986 for purposes of 
                determining the eligibility of such taxpayer for 
                benefits or assistance, or the amount or extent of 
                benefits or assistance, under any Federal program or 
                under any State or local program financed in whole or 
                in part with Federal funds.
    (b) Assets for Independence Innovation Demonstration Projects.--
            (1) Reauthorization.--The Assets for Independence Act (42 
        U.S.C. 604 note) is amended--
                    (A) in section 416, by inserting ``, and, subject 
                to section 417, $25,000,000 for each of fiscal years 
                2024, 2025, 2026, 2027, and 2028, to remain available 
                until expended.''; and
                    (B) by adding at the end the following new section:

``SEC. 417. RESERVATION OF FUNDS.

    ``(a) In General.--Subject to subsections (b) and (c), from the 
funds appropriated for each of fiscal years 2024, 2025, 2026, 2027, and 
2028 under section 416, the Secretary shall reserve--
            ``(1) $3,000,000 for general research and evaluation; and
            ``(2) any amounts remaining after application of paragraph 
        (1) to fund Assets for Independence innovation projects under 
        section 418.
    ``(b) Pilot Program Funding.--From the amounts reserved under 
subsection (a) for each of fiscal years 2024, 2025, and 2026, the 
Secretary shall make available for operating the pilot program 
established under section 7(c) of the Protecting America's Retirement 
Security Act of 2022--
            ``(1) 50 percent of the amount reserved for the relevant 
        fiscal year under paragraph (1) of subsection (a) (after any 
        adjustment under subsection (c)); and
            ``(2) 25 percent of the amount reserved for the relevant 
        fiscal year under paragraph (2) of subsection (a) (after any 
        adjustment under subsection (c)).
    ``(c) Proportional Adjustment.--In any of fiscal years 2024, 2025, 
2026, 2027, and 2028, if the amount appropriated for such fiscal year 
is greater or less than the amount authorized for such fiscal year 
under section 416, the amounts reserved under subsection (a) shall be 
increased or decreased for such fiscal year so that each such amount 
bears the same proportion to the amount appropriated as each of the 
amounts reserved under such subsection bears to the amount 
authorized.''.
            (2) Establishment of innovation program.--The Assets for 
        Independence Act (42 U.S.C. 604 note), as amended by paragraph 
        (1), is further amended by adding at the end the following new 
        section:

``SEC. 418. ASSETS FOR INDEPENDENCE INNOVATION PROJECTS.

    ``(a) In General.--The Secretary is authorized to make grants to 
qualified entities to conduct Assets for Independence innovation 
projects under this section.
    ``(b) Definitions.--For purposes of this section:
            ``(1) Assets for independence innovation project.--The term 
        `Assets for Independence innovation project' means a 
        demonstration project carried out by a qualified entity under 
        this section.
            ``(2) Innovation development account.--The term `innovation 
        development account' means an account that is established in a 
        federally insured financial institution or a State insured 
        financial institution and meets such other requirements as are 
        established by the Secretary.
    ``(c) Application.--
            ``(1) Criteria and preferences.--
                    ``(A) In general.--Subject to subparagraph (B), in 
                considering an application to conduct an Assets for 
                Independence innovation project, the Secretary shall 
                apply subsections (c) and (d) of section 405 to the 
                application in the same manner that such subsections 
                apply to an application to conduct a demonstration 
                project under section 405.
                    ``(B) Modification.--For purposes of this 
                paragraph, paragraph (1) of section 405(c) shall be 
                applied without regard to the phrase `through 
                activities requiring one or more qualified expenses'.
            ``(2) Approval of assets for independence innovation 
        projects.--Not later than 12 months after the date of the 
        enactment of this section, the Secretary shall, on a 
        competitive basis, approve such applications to conduct Assets 
        for Independence innovation projects as the Secretary considers 
        to be appropriate, taking into account the considerations 
        required by paragraph (1). The Secretary shall ensure, to the 
        maximum extent practicable, that the applications that are 
        approved involve a range of communities (spread out both 
        geographically and in rural and urban areas) and diverse 
        populations.
    ``(d) Project Duration and Grant Amount.--
            ``(1) Duration.--The Secretary shall award grants under 
        this section for a period not to exceed 5 project years.
            ``(2) Grant amount.--For each project year of an Assets for 
        Independence innovation project approved under this section, 
        the Secretary may make a grant to the qualified entity 
        authorized to conduct the project. In making such a grant, the 
        Secretary shall make the grant on the first day of the project 
        year in an amount not to exceed the lesser of--
                    ``(A) the aggregate amount of funds committed as 
                matching contributions from non-Federal public or 
                private sector sources; or
                    ``(B) $1,000,000.
    ``(e) Eligibility and Selection of Individuals To Participate in an 
Assets for Independence Innovation Project.--
            ``(1) Eligibility criteria.--Subject to the approval of the 
        Secretary, each qualified entity conducting an Assets for 
        Independence innovation project shall establish eligibility 
        requirements for participants in the project. Such requirements 
        shall--
                    ``(A) be more expansive than the requirements 
                established under section 408; and
                    ``(B) ensure that eligibility is limited to low-
                income individuals.
            ``(2) Selection of individuals to participate.--Each 
        qualified entity conducting an Assets for Independence 
        innovation project shall select, from among the individuals 
        that meet the eligibility requirements established by the 
        entity under paragraph (1), the individuals--
                    ``(A) that the qualified entity determines to be 
                most appropriate to participate; and
                    ``(B) to whom the qualified entity will make 
                disbursements or deposits in accordance with subsection 
                (f).
    ``(f) Disbursements by Qualified Entities.--
            ``(1) In general.--Each qualified entity conducting an 
        Assets for Independence innovation project shall, in a manner 
        consistent with the program requirements established by such 
        entity, disburse to a third-party or deposit into the 
        innovation development account of each individual participating 
        in the project from the funds described in subsection (d)(2), a 
        matching contribution of not less than $0.50 and not more than 
        $8 for every $1 deposited in the account by a project 
        participant, except that the rate of matching shall be equal 
        for all individuals participating in the project conducted by 
        such qualified entity.
            ``(2) Limitation on disbursements for an individual.--Not 
        more than $5,000 from a grant made under subsection (d)(1) 
        shall be provided to any one individual over the course of the 
        Assets for Independence innovation project.
            ``(3) Limitation on disbursements for a household.--Not 
        more than $10,000 from a grant made under subsection (d)(1) 
        shall be provided to any one household over the course of the 
        Assets for Independence innovation project.
            ``(4) Adjustment for inflation.--
                    ``(A) In general.--For each calendar year after 
                2023, the dollar amounts in paragraphs (2) and (3) 
                shall be increased by an amount equal to the product 
                of--
                            ``(i) such dollar amount, and
                            ``(ii) the cost-of-living adjustment 
                        determined under section 1(f)(3) of the 
                        Internal Revenue Code of 1986 for the calendar 
                        year, determined by substituting `2022' for 
                        `2016' in subparagraph (A)(ii) thereof.
                    ``(B) Rounding.--If any increase determined under 
                subparagraph (A) is not a multiple of $50, such 
                increase shall be rounded up to the next lowest 
                multiple of $50.''.
            (3) Conforming amendments.--The Assets for Independence Act 
        (42 U.S.C. 604 note), as amended by paragraphs (1) and (2), is 
        further amended--
                    (A) in section 404(2), by inserting ``or section 
                418'' before the period;
                    (B) in section 406--
                            (i) in subsection (a), by striking ``to 
                        conduct a demonstration project under this 
                        title'' and inserting ``under section 405''; 
                        and
                            (ii) in subsection (b), by striking 
                        ``conducted under this title'' and inserting 
                        ``approved under section 405'';
                    (C) in section 407--
                            (i) in subsection (c)--
                                    (I) in paragraph (1)--
                                            (aa) in subparagraph (A), 
                                        by inserting ``or, in the case 
                                        of a participant in a project 
                                        conducted under section 418, 
                                        other permitted expenses'' 
                                        after ``qualified expenses''; 
                                        and
                                            (bb) in subparagraph (B), 
                                        by inserting ``or subsection 
                                        (f) of section 418'' after 
                                        ``section 410''; and
                                    (II) in paragraph (3), by inserting 
                                ``or section 418(d)(1)''; and
                            (ii) in subsection (d)(2)(A), by inserting 
                        ``or section 418(d)(1)'' after ``section 
                        406(b)'';
                    (D) in section 408, by striking ``conducted under 
                this title'' each place it appears and inserting 
                ``approved under section 405'';
                    (E) in section 409, by striking ``conducted under 
                this title'' and inserting ``approved under section 
                405'';
                    (F) in section 410, by striking ``under this 
                title'' and inserting ``conducting a demonstration 
                project approved under section 405'';
                    (G) in section 413(a), by inserting ``or section 
                418(c)'' after ``under section 405''; and
                    (H) in section 415, by inserting ``or innovation 
                development account'' after ``individual development 
                account''.
    (c) Matched Refund to Rainy Day Savings Pilot Program.--
            (1) In general.--Not later than 6 months after the date of 
        the enactment of this Act and using the funds made available 
        pursuant to section 417(b) of the Assets for Independence Act, 
        the Secretary of Health and Human Services, acting through the 
        Director of Community Services (in this section referred to as 
        ``the Secretary''), shall establish under this subsection a 
        matched savings account pilot program to encourage saving by 
        eligible individuals. Under the pilot program, a qualified 
        entity may apply to the Secretary for a grant to conduct a 
        pilot project described in paragraph (2) (in this section 
        referred to as a ``pilot project''). The pilot program shall 
        operate for a period of 3 years.
            (2) Pilot project described.--
                    (A) In general.--A pilot project is a project in 
                which a qualified entity establishes a matched savings 
                program that meets the requirements of subparagraph (B) 
                for eligible individuals who are selected by the entity 
                to participate in the program.
                    (B) Requirements.--
                            (i) Deposits into direct deposit 
                        accounts.--
                                    (I) In general.--A matched savings 
                                program established as part of a pilot 
                                project shall match amounts saved by 
                                each eligible individual participating 
                                in the pilot project--
                                            (aa) with the amount 
                                        matched to be equal to or less 
                                        than the amount of any payment 
                                        deferred by such individual 
                                        under the Refund to Rainy Day 
                                        Savings Program established in 
                                        subsection (a)(1); and
                                            (bb) with the rate of 
                                        matching to be equal for all 
                                        eligible individuals 
                                        participating in the program.
                                    (II) Timing.--Any amount described 
                                in subclause (I) shall not be 
                                distributed to an eligible individual 
                                until the amounts described in 
                                subparagraph (C)(ii) or (E)(ii) of 
                                subsection (a)(1) have been distributed 
                                to the bank account identified by such 
                                individual.
                            (ii) Evaluation of program by independent 
                        research organization.--
                                    (I) In general.--From amounts made 
                                available under section 417(b)(2) of 
                                the Assets for Independence Act, as 
                                added by subsection (b)(1)(B), the 
                                Secretary shall enter into a contract 
                                with an independent research 
                                organization for purposes of evaluating 
                                pilot projects conducted under this 
                                section.
                                    (II) Coordination.--Each qualified 
                                entity that establishes a matched 
                                savings program as part of a pilot 
                                project shall collaborate with the 
                                independent research organization 
                                described in subclause (I) to evaluate 
                                the outcomes and impact of the project.
                                    (III) Impact.--The evaluation 
                                described in subclause (I) shall 
                                include an examination of the 
                                demographic characteristics of the 
                                individuals participating in the pilot 
                                project, such as gender, race, age, 
                                geographic location, and family makeup, 
                                and how the impacts of the project vary 
                                among different demographic groups and 
                                the effects of the pilot program on 
                                retirement savings for eligible 
                                individuals.
                                    (IV) Program features.--The program 
                                features to be evaluated through the 
                                pilot projects conducted under this 
                                section may include--
                                            (aa) different levels of 
                                        matching contributions by 
                                        qualified entities;
                                            (bb) lock-out periods 
                                        during which an eligible 
                                        individual may not make 
                                        withdrawals from their account; 
                                        and
                                            (cc) educational materials 
                                        intended to promote savings.
                                    (V) Safeguarding privacy.--Any 
                                contract entered into under this clause 
                                shall require the selected independent 
                                research organization to take all 
                                necessary and proper precautions to 
                                protect eligible individuals' privacy 
                                and personally identifiable information 
                                when conducting the evaluation.
                    (C) Duration.--A pilot project shall be for a 
                duration of not more than 3 years.
                    (D) Federally funded benefits.--Any amounts 
                described in subparagraph (B)(i) which are distributed 
                to an eligible individual shall be treated in the same 
                manner as any refund made to such taxpayer under 
                section 32 of the Internal Revenue Code of 1986 for 
                purposes of determining the eligibility of such 
                taxpayer for benefits or assistance, or the amount or 
                extent of benefits or assistance, under any Federal 
                program or under any State or local program financed in 
                whole or in part with Federal funds.
            (3) Strategic communications plan.--The Secretary shall 
        devise a strategic communications plan to ensure a successful 
        pilot program.
            (4) Annual report to congress.--The Secretary shall submit 
        an annual report to Congress on the progress and outcomes of 
        the pilot program established under this section.
            (5) Definitions.--In this subsection:
                    (A) Eligible individual.--The term ``eligible 
                individual'' means an individual who--
                            (i) has deferred payment of the amount 
                        described in subsection (a)(1) under the Refund 
                        to Rainy Day Savings Program established in 
                        such subsection, and
                            (ii) meets the eligibility requirements 
                        under section 408 of the Assets for 
                        Independence Act, except that subsection (a)(2) 
                        of such section shall not apply.
                    (B) Qualified entity.--
                            (i) In general.--The term ``qualified 
                        entity'' means--
                                    (I) one or more not-for-profit 
                                organizations described in section 
                                501(c)(3) of the Internal Revenue Code 
                                of 1986 and exempt from taxation under 
                                section 501(a) of such Code;
                                    (II) a State or local government 
                                agency, or a tribal government, 
                                submitting an application to conduct a 
                                pilot project jointly with an 
                                organization described in subclause 
                                (I);
                                    (III) a site that offers free tax 
                                help to individuals who qualify through 
                                the Internal Revenue Service's 
                                Voluntary Income Tax Assistance or Tax 
                                Counseling for the Elderly programs; or
                                    (IV) an entity that--
                                            (aa) is--

                                                    (AA) a credit union 
                                                designated as a low-
                                                income credit union by 
                                                the National Credit 
                                                Union Administration; 
                                                or

                                                    (BB) an 
                                                organization designated 
                                                as a community 
                                                development financial 
                                                institution by the 
                                                Secretary of the 
                                                Treasury (or the 
                                                Community Development 
                                                Financial Institutions 
                                                Fund); and

                                            (bb) can demonstrate a 
                                        collaborative relationship with 
                                        a local community-based 
                                        organization whose activities 
                                        are designed to address poverty 
                                        in the community and the needs 
                                        of community members for 
                                        economic independence and 
                                        stability.
                                    (V) Rule of construction.--Nothing 
                                in this paragraph shall be construed as 
                                preventing an organization described in 
                                clause (i)(I) from collaborating with a 
                                financial institution or for-profit 
                                community development corporation to 
                                carry out the purposes of this section.
                                 <all>