H.R. 10039 – SMART Savings Act of 2026

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Updated August 14, 2026 at 4:21 AM UTC

The SMART Savings Act of 2026 would change the tax code so that certain individual retirement account plans are no longer subject to some of the prohibited‑transaction rules that currently apply to retirement trusts. It keeps the existing rules that stop owners from using their accounts for personal gain, but it broadens the definition of what counts as a “plan” and removes a few specific prohibited‑transaction restrictions. The changes affect anyone who holds an individual retirement account or similar retirement plan.

Key Provisions

Redefines “plan” in the prohibited‑transaction rules to include trusts under section 401(a) and plans under section 403(a) that are tax‑exempt under section 501(a).
Deletes several paragraphs (3‑6) of section 4975(c) and renumbers the remaining paragraph, effectively eliminating those specific prohibited‑transaction restrictions.
Amends section 4975(f)(8)(E) by removing a clause and renumbering the remaining clause.
Keeps self‑dealing prohibitions intact by updating section 408(e)(2)(A) and clarifying that “relationship benefits” are limited to reduced‑cost or free services tied to the account’s value or fees.
Applies the changes only to transactions that occur after the law is enacted.

Legislative Activity

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1 earlier action

HouseIntro Referral Latest Action

Referred to the House Committee on Ways and Means.

Ways and Means Committee

August 3, 2026

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HouseIntro Referral

Introduced in House

August 3, 2026

HouseIntro Referral

Referred to the House Committee on Ways and Means.

Ways and Means Committee

August 3, 2026

Bill Text

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Introduced in HouseIssued August 3, 2026

I

119th CONGRESS

2d Session

H. R. 10039

IN THE HOUSE OF REPRESENTATIVES

August 3, 2026

Ms. Tenney introduced the following bill; which was referred to the Committee on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to exempt individual account plans from certain prohibited transaction rules.

1.

Short title

This Act may be cited as the Simplifying Modern Access to Retirement Tools for Savings Act of 2026 or the SMART Savings Act of 2026.

2.

Exemption from prohibited transaction rules

(a)

In general

Paragraph (1) of section 4975(e) of the Internal Revenue Code of 1986 is amended to read as follows:

(1)

Plan

For purposes of this section, the term plan means a trust described in section 401(a) which forms a part of a plan, or a plan described in section 403(a), which trust or plan is exempt from tax under section 501(a).

.

(b)

Conforming amendments

(1)

Section 4975(c) of the Internal Revenue Code of 1986 is amended—

(A)

by striking paragraphs (3), (4), (5), and (6), and

(B)

by redesignating paragraph (7) as paragraph (3).

(2)

Section 4975(f)(8)(E) of such Code is amended by striking clause (ii) and by redesignating clause (iii) as clause (ii).

(c)

Preservation of self-Dealing prohibitions

Section 408(e)(2)(A) of the Internal Revenue Code of 1986 is amended to read as follows:

(A)

In general

(i)

Self-dealing

If, during any taxable year of the individual for whose benefit any individual retirement account is established, that individual or the individual's beneficiary deals with the income or assets of a plan in the individual's own interest or for the individual's own account or receives consideration for the individual's own personal account from any party dealing with the plan in connection with a transaction involving the income or assets of the plan, other than the receipt of any relationship benefits, such account ceases to be an individual retirement account as of the first day of such taxable year. For purposes of this paragraph—

(I)

the individual for whose benefit any account was established is treated as the creator of such account,

(II)

the separate account for any individual within an individual retirement account maintained by an employer or association of employees is treated as a separate individual retirement account, and

(III)

each individual retirement plan of the individual shall be treated as a separate contract.

(ii)

Relationship benefits

For purposes of clause (i), the term relationship benefits means reduced cost or no-cost products or services or enhanced or improved products or services or other benefits received by a person pursuant to an arrangement in which the account value of, or the fees incurred for services provided to, an individual retirement account are taken into account for purposes of determining eligibility to receive such benefit.

.

(d)

Effective date

The amendments made by this section shall apply to transactions occurring after the date of the enactment of this Act.