That mentioned, “the second tax reform is on the desk, all the pieces is on the desk. With a view to cross the reconciliation invoice, they need to generate adequate revenues to satisfy the agreed upon internet quantity. That is the place surprises can seem,” Bush identified.
Retirement Coverage
Whereas Safe 2.0 regulatory steerage is anticipated subsequent yr, the Labor Division’s fiduciary and ESG guidelines put forth below the Biden administration “are pure focal factors for the incoming administration and Congress,” mentioned Mark Iwry, the previous head of nationwide retirement coverage in the course of the Obama-Biden administration, who’s now a nonresident senior fellow on the Brookings Establishment in Washington.
Groom Legislation Group attorneys famous on a current webcast that among the many Safe 2.0 adjustments anticipated subsequent yr are tasks such because the retirement “misplaced and located” registry, savers match and portability research.
Catch-up contribution adjustments and part-time worker guidelines are additionally anticipated in early 2025, the legal professionals mentioned.
Iwry famous that two main elements ought to “restrict the affect” of the presidential transition on Safe 2.0.
First, the regulation “was famously bipartisan, largely as a result of a lot of it was proposed by and for trade stakeholders,” Iwry mentioned.
Second, “plan sponsors and their advisors, recordkeepers and different service suppliers want predictability, stability, and prepared methods to reduce compliance danger. That typically interprets to a want for well timed and sensible regulatory steerage on key points, equivalent to questions of interpretation below 2.0,” Iwry relayed.
“On the identical time, when the election adjustments the social gathering controlling the White Home, the brand new administration’s OMB doesn’t wait a lot previous midday on Inauguration Day to problem its short-term freeze of regulatory actions which can be within the pipeline,” Iwry continued.
The freeze “might be accompanied by a clawback warning that the incoming administration won’t essentially stand by prior administration’s administrative positions, particularly in lately issued steerage. Some incoming administrations have additionally focused current remaining steerage for administrative revocation or modification, along with the specter of retroactive invalidation below the Congressional Assessment Act,” Iwry added.
“For instance, Safe 2.0 requires most new and lately adopted 401(okay) plans to make use of auto enrollment and auto contribution will increase beginning in 2025,” Iwry mentioned. “Treasury and IRS steerage answering a number of interpretive questions on that is pending.”
Additionally, “Rothification of catch-up contributions for individuals above the desired wage degree can be required proper after the top of 2025 per that two-year deferral of efficient date,” Iwry mentioned. “Steering on some excellent questions is within the works however not issued but.”
Safe 2.0 was enacted Dec. 29, 2022, with a Jan. 1, 2024 efficient date for requiring catch-up contributions to be made in Roth kind solely.
Safe 2.0 gave the trade one yr “to arrange to implement that change,” Iwry mentioned.
“In mid-2023, Treasury yielded to trade’s pleas for extra time to regulate methods to implement this variation, and deferred the deadline for implementing the change by two years — till the beginning of 2026,” Iwry mentioned.
Treasury “additionally promised steerage alongside the way in which that might reply quite a lot of questions on how you can implement. That steerage remains to be pending. It’s unsure how quickly it will likely be issued,” that’s, it is perhaps issued earlier than year-end, or earlier than Jan. 20, 2025, Iwry relayed.
What Subsequent on the SEC
Securities and Trade Fee Chairman Gary Gensler might make a fast exit, earlier than inauguration day, in keeping with attorneys at Arnold & Porter.
Gensler’s time period expires in 2026, however “it isn’t seemingly he’ll proceed past inauguration day in January 2025 — whether or not he follows within the footsteps of his predecessor, Jay Clayton, and departs as early as December 2024, or stays till nearer to the inauguration like different previous chairs is an open query,” the attorneys mentioned in a current temporary.
Even with Republican management of each the White Home and Senate, “it might take a number of months into the brand new Trump administration earlier than a brand new SEC chair is nominated and confirmed,” the attorneys write.
Throughout that point, President-elect Trump “presumably will designate an appearing chair from the 2 present Republican commissioners, Hester Peirce or Mark Uyeda, with Peirce seeming extra seemingly given her seniority.”
Peirceand Uyeda, in addition to former SEC Commissioner Dan Gallagher, have been among the many names floated as doable replacements for Gensler.
DOGE
In the meantime, Trump’s deliberate Division of Authorities Effectivity (DOGE), to be headed by Elon Musk, will serve “as an advisory physique to the Trump administration, quite than a newly established federal company,” in keeping with analysts at Raymond James.
“This distinction is vital as advisory our bodies can’t make or implement rules, can solely present suggestions from outdoors of presidency, and don’t have both authorities funding or workers,” the Raymond James analysts mentioned.
“Whereas DOGE could make suggestions to the White Home on potential areas for cost-cutting, its affect will rely on the Trump administration’s, and in lots of instances Congress’, willingness to behave,” the analysts mentioned.