According to the American Benefits Council, Capitol Hill leaders have decided to apply the non-discrimination rules to catch-up contributions, as per the House version of the legislation. This could significantly limit the impact of this provision.
The Senate’s tax credit for low-income savers has also reportedly been set aside.
In a letter to House Speaker Dennis Hastert President Clinton said he supported the pension proposal, but wanted to make sure that:
- employer-provided pensions for workers are not harmed
- there are “meaningful protections” for workers affected by cash balance conversions
- there are progressive savings incentives for low- and moderate-income workers
The American Benefits Council also notes that the tax bill may include health provisions to provide further tax deductions for health insurance, long-term care and possibly an expansion of Medical Savings Accounts (MSAs).
Republican leaders are pushing for an “above the line” deduction for long-term care insurance, while the Clinton Administration prefers a tax credit for long-term care – and is opposed to MSAs.
– Nevin Adams firstname.lastname@example.org