With the release of the Obama administration’s proposed budget expected next week, some details are beginning to leak out, including proposals that would impose new limits on individual retirement accounts.
At least one proposed cap — a cumulative limit on individual tax-favored retirement saving accounts, including IRA rollovers — is reportedly in the budget proposal. According to a Washington Post article, the cap would be set at $3 million.
“We will vigorously oppose such proposals as unfairly punishing good savers,” says Brian Graff, CEO/Executive Director of NAPA and ASPPA. “Furthermore, and perhaps even more significantly, they are ‘plan killers’ — as business owners reach the cap, they will either shut down the plan or greatly reduce benefits since they will no longer benefit. This would leave workers with a greatly diminished plan or without any plan at all.”
Reportedly, changes in the formula used to calculate Social Security benefits — which would generate $130 billion in savings and $100 billion in revenue — are also on the table.
Look for more coverage of this issue and other fallout from the president’s budget proposal next week, and in the weeks and months to come.
