As consideration of Tax Reform 2.0 begins in the U.S. House of Representatives, the congressional Joint Tax Committee (JTC) revenue tables with estimates about the impact of the provisions on tax revenues.
The Family Savings Act — one of three bills under consideration — draws partially from the Retirement Savings and Enhancement Act (RESA), which has bipartisan support in both the House and Senate. The JTC estimates the cost of H.R. 6757 at nearly $21 billion over 10 years. With no apparent offsets to the legislation, this might give some pause in supporting the legislation, particularly should it advance to the Senate where it will be necessary to pick up Democratic support.
The two most expensive provisions in Chairman Brady’s legislation are the so-called Universal Savings Accounts at $8.6 billion and the exemption from the requirement minimum distribution rules for individuals with certain account balances at $6.2 billion.
As for MEPs/PEPs, that provision is estimated at nearly $3.7 billion. This purported revenue loss generally would result from more people participating in employer-sponsored retirement plans and deferring income up front. Of course, the congressional budget rules only look out over a 10-year horizon.
House Ways & Means Committee Chairman Kevin Brady (R-TX) intends to have the three bills ready for House floor consideration before the end of the month. The committee is scheduled to begin consideration of the three bills today, Thursday, Sept. 13, at 10:00 a.m. Look for our coverage of that meeting on Friday.