The $1.9 trillion economic stimulus package, which passed the House on February 27, freezes retirement plan contribution limits starting in 2031.
The bill, H.R. 1319, the American Rescue Plan Act of 2021, would freeze the annual cost-of-living adjustments for overall contributions to defined-contribution plans and for the maximum annual benefit under a defined-benefit plan. This measure would be effective for calendar years beginning after December 31, 2030, "[i]n what can only be called a budget gimmick," said Brian Graff, president and CEO of the American Retirement Association, a lobbying group, in a recent LinkedIn post.
Added Graff: "Fortunately, we have an opportunity to fix this in the Senate, and we are working hard to try and get this misguided provision eliminated."
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