“To amend the Internal Revenue Code of 1986 to establish that employers may offer employees a choice among tax-favored employer contributions.”
No CRS summary available for this bill.
This section establishes qualified benefit options plans, under which no amount is included in a participant's gross income solely because the participant elects to allocate employer contributions among qualified benefits—such as retirement plan contributions excludable under sections 402 or 403, health reimbursement arrangements or health savings account contributions excludable under sections 105 or 106, qualified educational assistance excludable under section 127, and other tax-excluded benefits—provided participants may not elect cash or other taxable benefits instead. The provision applies nondiscrimination rules similar to section 125 (cafeteria plans) to highly compensated participants and key employees; treats available contributions as plan contributions for qualified retirement plan testing under sections 401(a)(4) and 416; amends reporting requirements under section 6039D; and applies to taxable years beginning after December 31, 2025.