WASHINGTON – A bill that aims to streamline individual retirement accounts into one retirement savings account (RSA) for smoother retirement planning was introduced last week by U.S. Rep. Sam Johnson (R-Texas). The Retirement Savings Account Act, H.R.4714, would consolidate the three types of current-law IRAs into a single account. After-tax annual contributions of up to $5,000 per person would be permitted with no income caps. Earnings on these retirement accounts grow tax-free and distributions after age 58 would be tax-free. The $5,000 contribution limit would be indexed for inflation. Withdrawals currently permitted from IRAs, such as home purchase, education, health costs, unemployed periods, etc., would instead be facilitated through savings in Lifetime Savings Accounts (H.R. 4078), Johnson explained. Leon Peace, CUNA legislative counsel for tax, pensions and housing said CUNA is looking forward to working with Johnson and the other members of the tax writing committees to develop legislation that will encourage more Americans to save for their retirement years. Sen. Craig Thomas (R-Wyo.) is expected to introduce a similar bill in the Senate. President George W. Bush first proposed RSA in 2003 and again in fiscal years 2004 and 2005.

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