President Donald Trump took to Twitter this morning to push back against a report that Republicans were planning on making a serious alteration to 401(k) contribution limits.
The New York Times reported over the weekend that the change could limit annunal contributions to as low as $2,400, meaning that more of your income would be taxed as a result.
Rumors have circulated for months that negotiators were debating including a cap as a way to help offset the revenue loss from a reduction in business tax rates that Republicans have put at the center of their plan. Reducing contribution limits would be, in effect, an accounting maneuver that would create space for tax cuts by collecting tax revenue now instead of in the future.
Such a move would be likely to push Americans to shift their savings to so-called Roth accounts, where contributions are taxed immediately, and not when they are drawn out as benefits. That would increase federal tax receipts for the short run.
Trump, however, says it’s not going to happen.
There will be NO change to your 401(k). This has always been a great and popular middle class tax break that works, and it stays!
— Donald J. Trump (@realDonaldTrump) October 23, 2017
RedState has also reached out to Paul Ryan’s office and the House Ways and Means committee for comment.
The supposed change to 401(k) contributions would be a major hit to middle class families, would ultimately be a tax increase on them, a move that even the Obama Administration recognized as a PR nightmare.
However, there has been very little Republican pushback on the story, which broke over the weekend. The Times story does note that its primary sources for the article it released were Democrats and lobbyists, who are not exactly among the most trustworthy of sources.
Hopefully, the Republicans are not seriously considering this, as it is far and away the worst idea to include in a tax reform package that is supposed to help the middle class.
UPDATE: Speaker Paul Ryan’s is pushing back against the New York Times story, calling it “poorly sourced,” but is referring to the Ways and Means Committee for comment, as they are the committee working on the bill.