part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new item: Sec. 45S. Small employer automatic IRA arrangement. . (d) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2018. 4. Increase in credit limitation for small employer pension plan startup costs (a) In general Section 45E(b)(1) of the Internal Revenue Code of 1986 is amended to read as follows: (1) for the first credit year and each of the 2 taxable years immediately following the first credit year, the greater of— (A) $500, or (B) the lesser of— (i) $250 for each employee of the eligible employer who is not a highly compensated employee (as defined in section 415(q)) and who is eligible to participate in the eligible employer plan maintained by the eligible employer, or (ii) $5,000, and . (b) Effective date The amendment made by this section shall apply to taxable years beginning after December 31, 2017.