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Tax Tip of the Week | No. 330 | The Future of Retirement Planning – Part 3 November 25, 2015

Posted by bradstreetblogger in : General, Tax Planning Tips, Tax Preparation, Tax Tip, Uncategorized , trackback

Tax Tip of the Week | November 25, 2015 | No. 330 | The Future of Retirement Planning – Part 3

We are going to run a three-part series of articles written by Wealth Management.com. Several legislative changes are on the horizon that will impact everything we know about retirement planning.  Here is what Washington lawmakers have in their crosshairs:

Limits on contributions

Some retirement policy reform plans have called for capping the amount that could be contributed pretax to retirement accounts. A Republican plan put forward in 2014, for example, would have disallowed contributions to traditional IRAs and removed income limits on Roth IRA contributions. The proposal, which came from then House Ways and Means Committee chairman Dave Camp, also would have limited pretax employee contributions to 401(k) plans to half the total contribution limit, with any additional contributions going into Roth accounts. He also wanted to suspend inflation adjustments on total contributions to 401(k) s until 2024.

“There’s always some nervousness about contribution limits or changes in the inflation indexing of limits,” says VanDerhei.

RMD harmonization

This one doesn’t come up often in Washington, but the White House’s proposed moves to simplify required minimum distribution (RMD) rules are worthy of noting here. Harmonization would involve introducing RMDs for Roth IRAs after age 70 ½, and limiting new contributions to Roths after that age (unifying the rules for Roths with traditional IRAs).

 

You can contact us in Dayton at 937-436-3133 and in Xenia at 937-372-3504.  Or visit our website.
Rick Prewitt – the guy behind TTW

…until next week.

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