401(k) Plans Are Back on the Chopping Block

ABC News reports that 401(k) retirement plans are on the chopping block after all:

The White House, as the president tweeted, wanted to keep the current annual maximum for tax-free contributions ($18,000); House Republicans wanted to lower the limit to $2,400. The bill, as of this morning, would lower what individuals may contribute tax-free to their 401(k)s, to an amount about halfway between the current limit and what House Republicans initially proposed.

If the new maximum is indeed halfway between, it comes to $10,200. So if you contribute, say, 5 percent of your salary, it means the cap will start to hit you at an annual salary of about $200,000 instead of $400,000.

In other words, this will make no difference to about 97 percent of us. So I guess I can’t get too worked up about it. The only thing that makes it bad is the same thing that makes the entire Republican tax bill bad: this is being done solely to pay for a tax cut that will go overwhelmingly to the very rich. In today’s GOP, even the moderately rich aren’t safe from having their taxes raised in order to pay for tax cuts to the folks making even more than them.

Fact:

Mother Jones was founded as a nonprofit in 1976 because we knew corporations and the wealthy wouldn’t fund the type of hard-hitting journalism we set out to do.

Today, reader support makes up about two-thirds of our budget, allows us to dig deep on stories that matter, and lets us keep our reporting free for everyone. If you value what you get from Mother Jones, please join us with a tax-deductible donation so we can keep on doing the type of journalism that 2018 demands.

Donate Now