Require the government to provide plain language explanations that make IRAs user-friendly for ordinary Americans and less prone to inadvertent errors.
Establish a correction program for common errors to encourage IRA owners and providers to voluntarily correct mistakes they discover in exchange for reduced sanctions.
The excise tax imposed for failure to take required minimum distributions would be reduced from 50% to 10%. The excise tax imposed for making excess contributions would be reduced from 6% to 3%.
Expand IRS Employee Plan Compliance Resolution System to permit all IRA providers to correct inadvertent errors they make, such as missing the deadline for completing a rollover contribution.
Provide a 180-day grace period for IRA owners to take required minimum distributions before any excise tax is imposed.
Level the playing field for IRAs to parallel the treatment of employer sponsored plans.
Provide IRA owners peace of mind by starting the statute of limitations on the date they file their individual 1040 tax return. Limit the potential loss of tax qualification for IRAs so sanctions for prohibited transactions mirror those applicable to employer plans. Eliminate the early distribution tax imposed on earnings when IRA owners correct excess contributions.