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U.S. House Members Demand 2008 RMD Relief from Bush
The letter by the group, led by Representatives Spencer Bachus (R-Alabama) and Rodney Frelinghuysen (R-New Jersey), demands that Bush order the Treasury Department to reverse its decision not to extend the RMD relief to 2008 (see Treasury Ducks 2008 RMD Relief ) and to allow those already forced to take a distribution to recontribute it “in order to give their savings time to recover from the down market.”
“While the Internal Revenue Code requires retired individuals to begin taking withdrawals the later of the year after they retire or the year after they turn 70 ½, it is our understanding that Treasury regulations set the specific intervals and penalties, and therefore the distribution requirements could be adjusted for 2008 without Congressional action,” the letter stated.
“Federal tax regulations should not force seniors to take money from their retirement accounts at a time when the value of their investments has plummeted,” Bachus said in a news release. “The bill pending before the President (signed by Bush into law earlier this week (see Bush SIgns RMD, Pension Relief Bill ) is a good step going forward, but seniors have already suffered significant losses and administrative action is needed to protect their savings this year as well.”
Added Frelinghuysen: “The government should not mandate financial losses on retirees by forcing them to sell their stocks when the market is low. The President should step in and help older Americans by suspending mandatory minimum withdrawal rules for 2008.”
align="center"> December 19, 2008
Via Facsimile (202-456-3501)
The Honorable George W. Bush
President of the United States of America
The White House
1600 Pennsylvania Avenue, N.W.
Washington, DC 20500-0001
Dear Mr. President,
It is our understanding that you are on schedule to sign H.R. 7327, the Worker, Retiree, and Employer Recovery Act of 2008, in the next few days. This legislation contains an important provision temporarily waiving the required minimum distribution rules for IRAs, 401(k)s, and 403(b)s for the 2009 tax year.
We respectfully request that you use your executive authority to direct the Secretary of the Treasury to use the flexibility provided by statute to immediately waive the same rules for the 2008 tax year. Furthermore, we ask that you use the same authority to allow retirees who have already withdrawn in 2008 to make recontributions to their accounts. By doing this, you will allow retirees to protect some of their savings during these rough economic times.
While the Internal Revenue Code requires retired individuals to begin taking withdrawals the later of the year after they retire or the year after they turn 70 ½, it is our understanding that Treasury regulations set the specific intervals and penalties, and therefore the distribution requirements could be adjusted for 2008 without Congressional action.
We thank you in advance for your prompt consideration of this request.
Respectfully,
__________________ __________________
Spencer Bachus Rodney Frelinghuysen
Member of Congress Member of Congress
__________________ __________________
Cathy McMorris Rodgers Pete Sessions
Member of Congress Member of Congress
__________________ __________________
Jo Bonner Mike Rogers (AL)
Member of Congress Member of Congress