NEW: Republican Tax Plan Targets Retirement Accounts
November 14, 2017
“Now Republicans want to make it harder and more expensive for older Americans to save for retirement. Instead of giving financial security to working Americans, Republicans wrote a tax plan for their campaign donors. The American people deserve better.” – DNC spokesperson Daniel Wessel
CNBC: Senate tax tweak would curb pretax 401(k) catch-up contributions
By Darla Mercado
Workers over age 50 would no longer be able to make catch-up contributions on a pretax basis to their retirement plans under a new amendment to the GOP's Senate version of the tax bill.
Orrin G. Hatch, chairman of the Senate Finance Committee, filed the amendment to the bill on Monday.
This amendment would permit workers over age 50 to contribute up to an additional $9,000 each year to their retirement plans, but it would require that these contributions be made to Roth accounts. Those are accounts where taxes are paid upfront.
Currently, employees over age 50 can contribute up to $6,000 in additional savings each year to their 401(k) plan and do so on a pretax basis. That's on top of the current annual $18,000 limit.