In an attempt to get ahead of the curve on tax reform, the Society for Human Resource Management is calling on its members and their networks to lobby against any significant changes to the deferred tax status of employer-provided retirement plans.
In a missive to its members, SHRM warned that politicians may attempt to gut the deferred status of such plans as part of a strategy to balance the federal budget.
Noting that employee benefits, including retirement plans, "generate the largest annual loss in revenue for the federal treasury because of their tax-deferred status," SHRM cautioned: "As a result, it is expected that public-policy efforts to reform the tax code and reduce the federal deficit will involve an examination of employer-sponsored fringe benefits, including retirement plans.
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"It is crucial that HR professionals tell members of Congress how important it is not to change the current tax treatment of retirement plans!"
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The organization said Department of Labor statistics underscore the importance of the tax status of retirement plans. Today, the DOL says, 670,000 defined contributions plans exist, covering 67 million people. Another 48,000 defined benefit plans cover 19 million more.
SHRM chairs the Coalition to Protect Retirement, whose members include trade and professional groups, benefits plan representatives and many other engaged in providing retirement protection to employees. The coalition's website – www.howamericasaves.com – offers a portal to support the lobbying campaign.
If there's any doubt about how most Americans feel about attempts to fiddle with the deferred tax status, SHRM cites a national study that reveals that, "by a ratio of 4 to 1, Americans do not want Congress to change the current tax incentives for retirement savings accounts. At least 80 percent of Democrats, Republicans and Independents — across demographic and economic spectrums — believe that retirement savings should be off-limits in Congress' efforts to raise revenue."
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Dan Cook
Dan Cook is a journalist and communications consultant based in Portland, OR. During his journalism career he has been a reporter and editor for a variety of media companies, including American Lawyer Media, BusinessWeek, Newhouse Newspapers, Knight-Ridder, Time Inc., and Reuters. He specializes in health care and insurance related coverage for BenefitsPRO.
