Individual Retirement Arrangements (IRAs)

The House-passed tax reform bill (H.R. 3838) would make three changes in Individual Retirement Arrangements (IRAs): (1) correct an anomaly in the "spousal IRA," (2) coordinate certain "elective deferrals" to 401(k) plans and 403(b) annuities with the IRA deduction limits, and (3) increase the additional income tax on "early withdrawals" from 10 to 15 percent. Although the Administration an the House Committee on Ways and Means had common goals in developing changes to IRAs, their proposals differ. This paper discusses and analyzes these differences.,Abstract -- Summary of Proposed Changes -- The Spousal IRA. Present Law ; Administration's Proposal ; HR 3838 -- Coordination with 401(k) Plans and 403(b) Annuities. Present Law ; Administration's Proposal ; HR 3838 -- Increase in Income Tax on Early Withdrawals. Present Law ; Administration's Proposal ; HR 3838 -- Analysis. The Spousal IRA Provision ; Coordination with 401(k) Plans and 403(b) Annuities ; Increase in Income Tax on Early Withdrawals -- Bibliography.,Richard A. Hobbie, Specialist in Social Legislation, Education and Public Welfare Division.,CRS 86-553 EPW,"February 13, 1986.",SuDoc# 14. 18/3