David R. Cedrone, CPA, M.S. Taxation, CGMA

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Trump, Brady hint at second round of tax cuts

President Trump and House Ways and Means Committee Chairman Kevin Brady dangled the prospect of further tax legislation later this year; but it is not clear what proposals might be included beyond extending the temporary individual tax cuts in the tax reform legislation enacted last December, and expectations are exceedingly low for a measure clearing Congress in 2018.

Hatch, Wyden introduce bipartisan retirement savings legislation

Senate Finance Committee Chairman Orrin Hatch, R-Utah, and ranking member Ron Wyden, D-Ore., introduced bipartisan legislation March 8 aimed at making it easier for small employers to offer retirement savings plans to their employees and for individuals to save for retirement.

 

The Retirement Enhancement and Savings Act of 2018 (S. 3471) would, among other things:

  • Increase access to retirement plans for workers in small companies by authorizing multiple employer defined contribution plans;
  • Remove the cap under section 401(k) that limits automatic escalation of employee deferrals to no higher than 10 percent of employee pay under an automatic enrollment safe harbor plan;
  • Simplify the section 401(k) safe harbor rules;
  • Increase the tax credit limitation for small employer pension plan start-up costs;
  • Provide a tax credit to employers who start new section 401(k) or SIMPLE IRA plans that include automatic enrollment or convert an existing plan to an automatic enrollment design; and
  • Allow individuals to make contributions to an IRA beyond the current-law cutoff age of 70-1/2.

The text of the legislation and a section-by-section summary are available on the Finance Committee website.

 

Hatch and Wyden did not indicate when the measure will be taken up by the full committee. Senate taxwriters approved a similar version of the bill in 2016.

 

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