SERS INVESTMENT OPTIONS:
INCLUDE ROTH 401(K)
House Bill 4502
Sponsor: Rep. Lisa Wojno
Committee: Government Operations
Complete to 4-27-07
A SUMMARY OF HOUSE BILL 4502 AS INTRODUCED 3-21-07
The bill would amend Sections 56 and 58 of the State Employees Retirement Act to require the state treasurer to include a Roth 401(k) account option among the available categories of investments offered to qualified participants, former qualified participants, and refund beneficiaries in the Tier 2 system.
The Tier 2 state employees retirement system is a defined contribution system (as opposed to the original defined benefit system). It applies to employees hired on or after March 31, 1997.
[A Roth 401(k) differs from the standard 401(k) option in that contributions to a Roth are made out of after-tax income but withdrawals are not taxed. With the existing 401(k) option, contributions are made out of pre-tax income but withdrawals are subject to tax.]
MCL 38.56 and 38.58
FISCAL IMPACT:
The bill would have no apparent fiscal impact on state government.
Fiscal Analyst: Al Valenzio
■ This analysis was prepared by nonpartisan House staff for use by House members in their deliberations, and does not constitute an official statement of legislative intent.