As a strong proponent of employer-sponsored retirement plans, it was important to me to participate in the advocacy for our industry. We are at a critical crossroad in our country with tax reform as there have been many proposals that could have potentially negative consequences for small-business retirement plans. I had the privilege to participate in the ASPPA March on Capitol Hill on October 24 where I was able to meet with the staff of Texas Senator John Cornyn, a key player in setting the priorities of tax reform. In addition to serving on the Senate Finance, Intelligence, and Judiciary Committees, Senator Cornyn serves as the Majority Whip, the second-highest ranking position in the Senate Republican Conference.
In the last week of October, as we neared the release of the tax proposal, we received conflicting reports about how retirement plans would be affected:
- Trump tweets, “There will be NO change to your 401(k).”
- Press reports that House Republicans were considering a proposal to mandate Roth deferrals in excess of $2,400.
In response, we focused on these critical components during the ASPPA March on Capitol Hill meetings:
- Importance of maintaining the tax incentives that encourage small business owners to sponsor workplace-based retirement plans and help their employees save for retirement.
- For pass-through entities, we need assurance that it continues to make economic sense for a pass-through owner to sponsor a retirement plan.
- Any changes to retirement savings must be primarily aimed at promoting retirement plan participation and encouraging retirement savings, rather than solely for the purpose of raising revenue for other tax objectives.
- Limiting pre-tax deductions for retirement savings, in the absence of other meaningful changes to promote retirement savings by middle-class families, would in fact be a middle-class tax increase threatening workers’ retirement security.
We will continue to participate in the conversation and voice support for employer-sponsored retirement plans.