class=”NoSpacing”>U.S. Representatives Earl Pomeroy (D-North Dakota) and Ginny Brown-Waite (R-Florida) today introduced The Retirement Security Needs Lifetime Pay Act, which provides tax incentives for workers to annuitize part of their retirement savings.
class=”NoSpacing”>The Retirement Security Needs Lifetime Pay Act, H.R. 2748, would encourage workers to annuitize some of their retirement savings by providing a 50% tax exclusion for up $10,000 of lifetime annuity payments annually.
class=”NoSpacing”> Other Provisions
class=”NoSpacing”>The bill will also exclude from taxes 25% of lifetime income payments from individual retirement accounts (IRAs), qualified plans, and similar employer-sponsored retirement savings plans other than defined benefit plans. It also excludes the value of longevity insurance from amounts subject to required minimum distributions (RMDs), and clarifies the taxation of partial annuity payments.
class=”NoSpacing”>”For years, the federal government has recognized its duty to assist American families in building a retirement nest egg,” Pomeroy said, in a press release. “Saving and investing for the long term is extremely important, especially in these challenging times. A greater retirement challenge lies ahead: managing assets to make sure that your retirement savings last a lifetime. The Retirement Security Needs Lifetime Pay Act will provide families with incentives to plan for a secure lifelong retirement.”
class=”NoSpacing”>This is not the first time such an idea has been introduced. In 2007, the Women’s Retirement Security Act was introduced that provided for 50% of lifetime annuity payouts generated from non-qualified contracts, up to $20,000 annually, as tax free (see ” Senate Bill Aims to Help Women with Retirement Planning “).
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