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Thread: Senate considering eliminating pretax 401k catch-up contribution

  1. Default Senate considering eliminating pretax 401k catch-up contribution

    Workers over age 50 would no longer be able to make catch-up contributions on a pretax basis to their retirement plans under a new amendment to the GOP's Senate version of the tax bill.
    [URL]https://www.cnbc.com/2017/11/13/senate-tax-tweak-would-curb-pretax-401k-catch-up-.html[/URL]

    Last edited by StockSurfer; 11-14-2017 at 05:43 AM.


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  3. Default Re: Senate considering eliminating pretax 401k catch-up contribution

    Quote Originally Posted by StockSurfer View Post
    Workers over age 50 would no longer be able to make catch-up contributions on a pretax basis to their retirement plans under a new amendment to the GOP's Senate version of the tax bill.
    [URL]https://www.cnbc.com/2017/11/13/senate-tax-tweak-would-curb-pretax-401k-catch-up-.html[/URL]

    Hatch Amendment #2 to Chairman’s mark of “Tax Cuts and Jobs Act.”
    Short Title: An amendment to the catch up contribution rules for section 401(k), 403(b) and 457)(b) retirement savings plans.
    Description of Amendment: This amendment would require all catch up contributions to section 401(k), 403(b) and 457(b) retirement savings plans to be Roth only, and increase the $6,000 catch up contribution annual limit applicable to such plans to $9,000.
    Offset: This amendment is expected to raise revenue in the 10-year budget window.

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  5. #3

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    Default Re: Senate considering eliminating pretax 401k catch-up contribution

    Definitely a tax increase on those trying to max out both catchup and Roth, just when they can at last try to make up for all the years they couldn't save enough and yet it's still a challenge. hmm. something wrong with that picture.
    "life can only be understood backwards, but it must be lived forwards" - soren kierkegaard

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    Default Re: Senate considering eliminating pretax 401k catch-up contribution

    Quote Originally Posted by alevin View Post
    Definitely a tax increase on those trying to max out both catchup and Roth, just when they can at last try to make up for all the years they couldn't save enough and yet it's still a challenge. hmm. something wrong with that picture.
    Maybe this will keep workers in the work force longer instead of retiring in their early to mid 60s. I'm not trying to be political but this is one way to ensure Social Security etc remains and they don't have to reap the backlash of changing the age you can start collecting or contribution percentage. Plus it gives them the ability to kick debt down the road further since workers will be working longer. Its a win for them and a loss for us.

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    Default Re: Senate considering eliminating pretax 401k catch-up contribution

    Quote Originally Posted by StockSurfer View Post
    Workers over age 50 would no longer be able to make catch-up contributions on a pretax basis to their retirement plans under a new amendment to the GOP's Senate version of the tax bill.
    https://www.cnbc.com/2017/11/13/senate-tax-tweak-would-curb-pretax-401k-catch-up-.html
    Cactus posted this link https://www.fedsmith.com/2017/11/13/...contributions/ --would require Roth for Catch Up but looks like amount would increase $9K per Hatch amendment. Eliminating conversions would throw a wrench in my plans but as article states: "Both the House and Senate have introduced their own tax reform bills, and more changes are likely to take place to both as they work their way through the legislative process."

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  11. Default Re: Senate considering eliminating pretax 401k catch-up contribution

    Quote Originally Posted by evilanne View Post


    Cactus posted this link https://www.fedsmith.com/2017/11/13/...contributions/ --would require Roth for Catch Up but looks like amount would increase $9K per Hatch amendment. Eliminating conversions would throw a wrench in my plans but as article states: "Both the House and Senate have introduced their own tax reform bills, and more changes are likely to take place to both as they work their way through the legislative process."
    Messes up my retirement strategy as well... Instead of making maximum contributions during my preretirement years, having it grow in the market, and then withdrawing after retirement when my income is lower and I’m in a lower tax bracket, would have to pay maximum taxes on it now when i’m at the higher tax bracket. I contacted my reps about this proposal, it would take away an important mechanism to save for retirement ...

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    Default Re: Senate considering eliminating pretax 401k catch-up contribution


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