Senate Removes Cap on Retirement Plan Contribution Limits From Stimulus Bill
Senate Majority Leader Chuck Schumer has offered a substitute amendment.
The American Retirement Association said Thursday that it has successfully lobbied to have a provision in the stimulus bill to freeze retirement plan contribution limits removed.
The $1.9 trillion American Rescue Plan Act of 2021 would have frozen the annual cost-of-living adjustments for overall contributions to defined contribution plans and for the maximum annual benefit under a defined benefit plan. The measure would have become effective for calendar years beginning after Dec. 31, 2030.
Earlier this week, Brian Graff, ARA’s CEO, called the measure a “budget gimmick.”
According to ARA, Senate Majority Leader Chuck Schumer, D-N.Y., has offered a substitute amendment.
While the amendment still needs to be approved by the full Senate, “it appears very likely it will pass” since it was offered by the majority leader.
“This was a tremendous victory for the ARA and the retirement plan system,” Graff said. “The government affairs team worked tirelessly to make this happen knowing that it would have been extremely challenging to get this fixed in the future, especially without the support of unions which were exempted from the freeze.”