Washington, D.C. partner Brad Campbell was quoted in an April 21 Wall Street Journal column entitled, “Grab Your Pitchforks, Americas, Your 401(K) May Need Defending from Congress.” Brad’s comments in The Wall Street Journal were also quoted in a Barron’s article entitled, “Congress May Roth-ify the 401(k).”
To raise revenue in connection with comprehensive tax reform, Congress is currently considering changing the tax treatment of retirement plans, reducing some of the benefits of contributing to a 401(k) and similar plans. Brad notes that retirement plans are “poised to be one of the losers [in tax reform]” and that Congress is considering, among other changes, mandating post-tax Roth contributions rather than traditional pre-tax contributions to 401(k)s and similar plans. These and other changes could negatively affect the incentives for retirement saving.
Brad also stated that there should be equal sacrifice for the federal retirement system if Congress is going to reduce the tax advantages of private retirement plans.