The Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) was signed into law by President Bush on June 7, 2001 and is being hailed by Transamerica Retirement Solutions, major employers and the ERISA Industry Committee as a significant pension achievement. This legislation is designed to increase retirement savings for all Americans by making defined contribution retirement plans more beneficial and portable - which means it makes your retirement plan more valuable.
Most of the changes took effect as of January 2002 and have made it easier for you to build a more secure future. Additional changes have been outlined through the year 2006.
- Higher annual contribution limits for all employees
- Opportunity for employees 50 and older to catch-up on retirement savings
- Great retirement plan portability-the ability to easily consolidate your assets between different retirement plans
- New tax savings-Income tax credit of up to $1,000 available for certain low and middle income savers who make elective contributions to a 401(k), Simple 401(k) or SEP-IRA