IRAs suddenly of great interest to Washington

IRAs suddenly of great interest to Washington
Two new measures targeting the accounts introduced in the past week; source of savings, source of tax revenue
MAR 29, 2012
Two individual retirement account measures were proposed last week, one that attempts to encourage more Americans to save for retirement and another that would make inherited IRAs less valuable in many cases. Sen. Richard Neal, D.-Mass., introduced HR 4049, which would require companies to automatically offer employees access to an IRA if they don't already sponsor a qualified retirement plan. It would allow for a few exemptions for small businesses and new firms. The American Society of Pension Professionals & Actuaries supports the plan, which would provide small employers a tax credit for offering automatic payroll deductions to employees to help them save for retirement. Brian Graff, chief executive of the association, said he expects once firms participate in such automatic savings, they will be more likely to offer employees a 401(k) retirement plan. Today about 78 million American workers, about half of U.S. workers, don't have an employer-sponsored retirement plan and most party leaders – including President Barack Obama -- agree that such a proposal is a great way to help even out the retirement savings playing field for the other half. Sen. Jeff Bingaman, D., New Mexico, introduced an auto IRA bill in September in the Senate. In the second IRA proposal brought up last week, Sen. Max Baucus, D-Mont., introduced a provision in a highway bill that could hurt the benefits of those who inherit IRAs. The provision, which Mr. Baucus said would generate $4.6 billion over a decade, would no longer allow everyone to defer paying taxes over their lifetimes on IRAs that they inherit. Instead, only a spouse, minor child or a disabled beneficiary would still get this benefit, while others (including adult children) would have only five years to defer paying taxes on the account. The Financial Services Institute is one of the groups fighting this idea, arguing the proposal would deter savings at a time when Americans' savings already are strained.

Latest News

Departing Gurbir Grewal took the SEC "into new territory"
Departing Gurbir Grewal took the SEC "into new territory"

Having led the division of enforcement since 2021, Grewal's tenure included record penalties against firms for securities-law violations.

Choosing the name of your new RIA is "like getting married"
Choosing the name of your new RIA is "like getting married"

Name for new business should consist of values, beliefs and "the why", advisors say

B. Riley sees another top advisor jump ship
B. Riley sees another top advisor jump ship

“It makes you wonder what’s next,” says one recruiter.

Vanguard Charitable cheers $20B grant milestone
Vanguard Charitable cheers $20B grant milestone

The leading non-profit and donor-advised fund sponsor cited exponential growth in giving, particularly among long-term philanthropic investors.

Focus Financial partner Kovitz to absorb Fort Pitt Capital
Focus Financial partner Kovitz to absorb Fort Pitt Capital

The latest development will add $5.9B to the Chicago-based powerhouse while extending its reach in Pennsylvania.

SPONSORED Leading through innovation – with Tom Ruggie of Destiny Wealth Partners

Uncover the key initiatives behind Destiny Wealth Partners’ success and how it became one of the fastest growing fee-only RIAs.

SPONSORED Client engagement strategies, growth and retention in the down markets

Key insights from Gabriel Garcia on adapting to demographic shifts and enhancing client experience in a changing market