Retirement tax incentive bill introduced
By Sara Hansard
March 29, 2007
investmentnews.com
Legislation that would provide tax incentives to encourage people to invest a portion of their retirement assets into individual annuities was introduced in the Senate today.
The Retirement Security for Life Act of 2007, introduced by Sens. Kent Conrad, D-S.D., and Gordon Smith, R-Ore., Introduced would allow retirees to receive up to $20,000 annually tax-free from individual annuities.
It would provide a 50% deduction on income up to $40,000 a year received from an annuity.
For a typical American in the 25% tax bracket, that would provide an annual tax savings of up to $5,000, according to a release from the American Council of Life Insurers in Washington, which has called for passage of the bill.
“America is becoming more and more aware of the growing retirement income crisis facing the baby boom generation and the need for Americans to save for retirement,” said ACLI president and chief executive Frank Keating in a press release.
“While saving is a vital concern, it is equally important for Americans to have the tools available to manage their retirement assets to assure that they will last a lifetime,” Mr. Keating said in the release.
The legislation is similar to legislation introduced in the House and the Senate last year, when it was estimated it would cost $22 billion over 10 years in lost federal tax revenue if enacted.
No comparable legislation has yet been introduced in the House. |
