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Pension Bill
On Thursday, Congress passed H.R. 4, The Pension Protection Act of 2006. The Tax Policy Center has estimated the effects of the bill on the distribution of tax burdens. The revenue measures in the bill would make permanent the pension and IRA provisions contained in the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA). These include the increased contribution limits for IRAs and 401(k) and related plans that were scheduled to expire at the end of 2010. The bill also makes permanent the saver's credit, which would have expired at the end of 2006, and indexes its income limits for inflation beginning in 2007.
TPC analysis shows that although more than two-thirds of the bill's benefits accrue to the top twenty percent of income earners, the tax cut is roughly proportional to income for all groups.
Link to the Pension Protection Act of 2006 estimates
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