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Compliance January 1, 2004
House Bill to Kill IRA RMDs Reintroduced
January 13, 2003 (PLANSPONSOR.com) - A Republican
Congressman has re-introduced a bill that would strike the
current requirement that Americans start withdrawing money
from their Individual Retirement Accounts (IRA) by age 70
½.
Reported by Fred Schneyer
The latest proposal from Rep. Jim Saxton (R-New Jersey), follows a similar bill he introduced during the last Congressional session, according to Washington-based legal publisher BNA. (See IRA Required Distribution Bill Leaves Out Qualified Plans ) Saxton’s bill not only strikes the required distributions, it also would eliminate the current 50% excise tax on amounts that should have been withdrawn.
“I have long believed that mandating withdrawals from IRAs at age 70 1/2 is counterproductive and biased against saving and investment,” Saxton said in a statement, according to the BNA. “After all, the threshold is arbitrary, and seniors should be allowed to continue holding their assets in retirement plans until they need them for medical and living expenses, as well as emergencies. I also believe the current threshold is discriminatory and unfair to seniors.”
Saxton was also involved in the release of a Congressional Joint Economic Committee study entitled The Taxation of Individual Retirement Plans: Increasing Choices for Seniors . (See Report Calls for Repeal, Reform of Required Distributions ).