House Votes to Make Retirement-Related Tax Cuts Permanent

Members of the House of Representatives sent a strong message to the Senate last week regarding the desire to solidify tax breaks for our aging society. In a 308-70 vote, with 115 Democrats joining 192 Republicans and one Independent, the House resoundingly voted to make permanent the retirement-related tax breaks that were created with the Economic Growth and Tax Relief Act of 2001.

Under the terms of the original act, annual contributions to Individual Retirement Accounts will increase from $3,000 to $5,000 by 2008, and annual contributions to employer-sponsored 401(k) and similar plans will increase from $11,000 to $15,000 by 2006. These provisions are scheduled to expire on December 31, 2010, at which time they will revert to the contribution levels in place in 2001.

The House bill would make the increased retirement contribution levels permanent instead of allowing them to expire.

The bill faces an uphill struggle in the Senate, where many are arguing that with the economy in a recession and the government spending more money on national defense and domestic security, it would be irresponsible to pass such a bill at this time.

You may like these other stories...

Koskinen warns filing season could be most complicated yetImplementation of the Foreign Account Tax Compliance Act and the Affordable Care Act, combined with a tight budget and the possibility of Congress passing a late...
Accounting group pushes back against retirement age scrutinyMichael Rapoport of the Wall Street Journal reported that the American Institute of CPAs (AICPA) on Monday pushed back against federal regulators who are again...
There's still time to take advantage of last-minute, tax-saving moves for dependency exemptions. For 2014, there are bigger dependency exemptions, as well as rules that, in some cases, are dauntingly complex.The 2014...

Already a member? log in here.

Upcoming CPE Webinars

Oct 23Amber Setter will show the value of leadership assessments as tools for individual and organizational leadership development initiatives.
Oct 30Many Excel users have a love-hate relationship with workbook links.
Nov 5Join CPA thought leader and peer reviewer Rob Cameron and learn ways to improve the outcome of your peer reviews while maximizing the value of your engagement workflow.
Nov 12This webcast presents basic principles of revenue recognition, including new ASU 2014-09 for the contract method. Also, CPAs in industries who want a refresher on revenue accounting standards will benefit.