Unclaimed Retirement Rescue Plan

Bill Number

H.R. 5325

Origin Chamber

House

Congress

119th Congress, Session 1

Policy Area

Labor and Employment

Status

Introduced

Latest Action

2025-09-11: Referred to the Committee on Education and Workforce, 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.

Last Updated

2026-03-26T08:06:43Z

AI-Generated Summary

Purpose of the Legislation

This bill, titled the "Unclaimed Retirement Rescue Plan," aims to help reunite individuals with their unclaimed retirement savings by directing the Secretary of Labor to create a regulation. The regulation would allow administrators of certain pension plans (retirement savings plans regulated by federal law) to voluntarily send unclaimed funds to state unclaimed property programs, which are state-run systems designed to hold and return lost or forgotten financial assets to their owners.

Key Provisions

• Timeline for Regulation: The Secretary of Labor must issue the regulation within 180 days of the bill's enactment.
• Voluntary Transfer Process: Pension plan administrators or other responsible parties (fiduciaries, who manage the plans' assets) can transfer unclaimed retirement distributions to state programs via a national "Unclaimed Retirement Clearing House" that coordinates transfers across states.
• Prerequisites for Transfers:
• For amounts of $50 or more, plans must search databases (like commercial or government ones) for updated contact information if they suspect existing info is outdated.
• They must send a notice to the participant or beneficiary explaining the unclaimed funds, the plan to transfer them to the state where the person last lived, and how to claim them to avoid transfer.
• Notices can be sent via email, online portal, or mail, as long as they are secure and likely to reach the person; no notice is needed if searches fail to find updated contact info.
• Liability Protection: Plans and fiduciaries that follow the rules are considered to have met their duties under the Employee Retirement Income Security Act of 1974 (ERISA, a federal law protecting retirement benefits), including prudent management and avoiding prohibited transactions.
• Information Sharing: The Secretary must provide a way for plans to check if transferred funds have been claimed, helping update records.
• Reporting Requirements:
• Plans must submit quarterly reports to the Secretary with details like the participant's name, Social Security number, last address, amount transferred, and state involved; reports on claimed funds must also be included.
• Reports are not public (protected from disclosure under the Freedom of Information Act).
• All data feeds into the existing federal "Retirement Savings Lost and Found Database" to track unclaimed and claimed funds.
• Data Transmission Safety: Plans won't violate ERISA or face liability for sharing participant data with states via the clearinghouse, as long as they use reasonable care.
• Tax Implications: Transfers won't cause a pension plan's trust to lose its tax-qualified status under the Internal Revenue Code.
• Congressional Oversight: Within 24 months of the regulation, the Secretary must report to Congress on its progress, effectiveness, and improvement ideas.
• Definitions:
• "Unclaimed retirement distribution": For terminating plans, uncashed payments after 90 days; for others, unpaid obligations up to $5,000 (Secretary can raise this limit) uncashed after 12 months.
• Other terms include "contact information" (address, phone, email), "informational database" (commercial or government sources), and "state unclaimed property program" (state initiatives in the 50 states, D.C., Puerto Rico, and U.S. Virgin Islands).

Significant Changes to Existing Law

• Introduces a voluntary safe harbor (protected pathway) under ERISA for transferring small unclaimed retirement funds to states, which wasn't explicitly allowed before; previously, plans had to hold or escheat (hand over) funds under varying state laws without federal coordination.
• Integrates with the existing Retirement Savings Lost and Found Database (from a 2022 law) by adding transfer and claim data, creating a more unified tracking system.
• Provides explicit ERISA and tax relief for compliant transfers, reducing legal risks that might have deterred plans from acting.
• Shifts from plan-held funds to state-managed ones for easier public access, without mandating transfers (keeps it optional).

Potential Impacts

• On Citizens: Makes it simpler for workers and retirees to recover forgotten retirement savings through familiar state unclaimed property offices, potentially reuniting billions in lost funds (estimates suggest trillions in unclaimed retirement assets exist nationwide).
• On Government Agencies: The Department of Labor gains responsibility for rulemaking, reporting, and database updates, increasing administrative workload but enabling better oversight. States benefit from a national clearinghouse for streamlined fund intake and management.
• On Pension Plans: Eases the burden of tracking and holding unclaimed small amounts (under $5,000), allowing focus on active participants; provides legal protections to encourage participation.
• On International Relations: No direct impact, as the bill focuses on domestic U.S. pension plans and state programs.

Main Stakeholders Affected

• Pension Plan Administrators and Fiduciaries: Gain tools and protections to handle unclaimed funds efficiently.
• Participants and Beneficiaries: Primary beneficiaries, as they can more easily access lost retirement distributions through state programs.
• Department of Labor: Responsible for implementing the regulation, database integration, and reporting to Congress.
• State Governments: Receive and manage transferred funds via their unclaimed property programs, potentially increasing returned assets to residents.
• Congress: Receives oversight reports to evaluate and refine the program.

Notable Legal, Constitutional, or Political Implications

• Legal: Strengthens ERISA compliance by offering clear fiduciary relief and data-sharing protections, reducing litigation risks for plans; ensures tax-neutral treatment to avoid IRS penalties. Aligns with existing unclaimed property laws but adds federal coordination.
• Constitutional: No major issues; respects federal-state balance by making transfers voluntary and using state programs without overriding state authority.
• Political: Bipartisan introduction (by Reps. Magaziner (D) and Estes (R)) signals broad support for protecting retirement savings; could set precedent for federal facilitation of state financial recovery efforts, emphasizing consumer protection without new mandates.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Rep. Magaziner, Seth [D-RI-2]

Cosponsors (16)

Rep. Estes, Ron [R-KS-4], Rep. Mann, Tracey [R-KS-1], Rep. Schneider, Bradley Scott [D-IL-10], Rep. Casten, Sean [D-IL-6], Rep. Schmidt, Derek [R-KS-2], Rep. Hageman, Harriet M. [R-WY-At Large], Rep. Schrier, Kim [D-WA-8], Rep. Rogers, Mike D. [R-AL-3], Rep. Raskin, Jamie [D-MD-8], Rep. Flood, Mike [R-NE-1], Rep. Balint, Becca [D-VT-At Large], Rep. Fitzpatrick, Brian K. [R-PA-1], Rep. Thompson, Glenn [R-PA-15], Rep. Subramanyam, Suhas [D-VA-10], Rep. Liccardo, Sam T. [D-CA-16], Rep. Deluzio, Christopher R. [D-PA-17]

Recent Actions

• 2025-09-11: Referred to the Committee on Education and Workforce, 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.
• 2025-09-11: Referred to the Committee on Education and Workforce, 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.
• 2025-09-11: Introduced in House
• 2025-09-11: Introduced in House

Bill Versions

• Unclaimed Retirement Rescue Plan — issued 2025-09-11 — PDF (10 pages)