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Capping Small Business Retirement Savings

Changes in tax policies can trigger responses from employers, but a proposed cap on retirement savings could have a particularly severe impact on small businesses, according to an analysis by the nonpartisan Employee Benefit Research Institute (EBRI).

27. august 2014

As explained in the EBRI analysis, White House officials earlier this year unveiled the Obama administration’s Fiscal Year 2014 budget proposal, which included a cap on tax-deferred retirement savings. Under the proposal, a taxpayer who accumulated amounts in specified retirement accounts in excess of the amount necessary to provide the maximum annuity permitted for a tax-qualified defined benefit plan under current law would be (at least temporarily) prohibited from making additional tax-deferred contributions or receiving additional accruals under any of those arrangements.

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