Employees who earn less than $150,000 benefit the most from tax incentives they receive by putting money away in their employer-sponsored retirement plans.
Plan sponsors also receive a small benefit from the tax incentives, so why eliminate tax incentives as part of tax reform?
Those were the two big points made by Brian Graff, executive director and CEO of the American Society of Pension Professionals & Actuaries, in a letter to the House Ways and Means Committee's Pensions and Retirement Tax Reform Working Group.
The Obama White House has proposed doing away with these incentives after individuals are able to stash away several million to help balance the federal government’s budget. But as Graff pointed out, being able to make pre-tax contributions to a retirement account doesn’t mean people won’t pay taxes on that money later.