S. 3338

Small Business Employee Retirement Savings Act of 2016

This bill amends the Internal Revenue Code to modify the tax treatment of retirement plans for small employers with no more than 100 employees. The bill: (1) increases from $500 to $5,000 the limit on the amount of the tax credit for small employer pension plan startup costs, and (2) allows a three-year $500 business-related tax credit for small employers that include and maintain an automatic contribution arrangement in an employer-sponsored retirement plan.

The bill also removes the 10% cap on the amount of an employee's wages that an employer may contribute to a retirement plan under an automatic contribution arrangement.