The top GOP tax writer in the House said the tax proposal that Republicans plan to unveil next week could affect retirement account rules and how Americans save money. The plan could put him at odds with President Trump, who has promised not to touch 401(k) retirement accounts.
“We want more Americans to save more. We want them to save earlier in their lives,” House Ways and Means Committee Chairman Kevin Brady, R-Texas, said at a breakfast with reporters Wednesday.
On Monday, Trump tweeted, “There will be NO change to your 401 (k),” amid reports that Republicans writing the sweeping tax bill are considering reduced contribution limits for 401(k)s.
He reaffirmed his position Wednesday, telling reporters that leaving the retirement savings plans intact is “very important.”
“I didn’t want that to go too far. That’s why I ended it very quickly,” he said.
A move to lower contribution caps to the plans, which are not taxed until money is withdrawn from them, could force more Americans to contribute to their retirement by putting money into plans that are taxed immediately. The policy change would help pay for some of the tax cuts in the Republican plan — which is crucial to moving the bill through Congress.
Brady said Republicans are “exploring a number of ideas” and are “working very closely with the president.”
“We are continuing discussions with the president, all focused on saving more and saving sooner,” he said.
The House will vote Thursday on a budget resolution setting the parameters for the tax bill and clearing a procedural hurdle that will allow them to take up the legislation, which is expected to be released on Nov. 1.
Despite ongoing disagreements within the party over changes to state and local tax deductions, Republicans hope to pass the bill through the House by Thanksgiving and get it to Trump’s desk by the end of the year.
