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Utilization of Tax Incentives for Retirement Saving |
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August 2003 |
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Note
Numbers in the text and tables may not add up to totals because of rounding.
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This Congressional Budget Office (CBO) paper examines the utilization of tax incentives for retirement saving, focusing on 1997. The paper breaks down rates of participation in and contributions to retirement savings plans by age, income, and marital status/earner role and discusses the patterns that emerge and their implications for public policy. The paper was prepared at the request of the Senate Finance Committee to analyze the various incentives in the tax code that encourage people to save for retirement. A companion publication, CBO's Online Guide to Tax Incentives for Retirement Saving, describes those tax code features in detail along with the requirements that federal law imposes on pensions and other forms of savings.
Paul Burnham of CBO's Tax Analysis Division (TAD) wrote the paper under the direction of Roberton Williams and G. Thomas Woodward. The report's quantitative analysis built on programs written by David Weiner and John Sabelhaus. Within CBO, Robert Dennis, Douglas Hamilton, Arlene Holen, Deborah Lucas, and John Sturrock provided useful comments. In addition, John Gist and John Taylor of AARP and Richard Ippolito of the George Mason University School of Law reviewed early drafts of the paper and offered valuable criticism and suggestions.
Leah Mazade edited the manuscript, and Christine Bogusz proofread it. Denise Williams prepared early drafts of the text, tables, and figures, and Kathryn Winstead prepared the report for publication. Lenny Skutnik produced the printed copies, and Annette Kalicki prepared the electronic versions for CBO's Web site.
Douglas Holtz-Eakin
Director
August 2003
Tables |
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1. |
Summary of Workers' Participation in Tax-Deferred Retirement Plans in 1997 |
2. |
Workers' Participation in Tax-Deferred Retirement Plans in 1997 |
3. |
Workers' Participation in Employment-Based Retirement Plans in 1997 |
4. |
Workers' Participation in Individual Retirement Accounts and Keogh Plans in 1997 |
5. |
Workers' Average Contributions to Tax-Deferred Retirement Plans in 1997 |
6. |
Workers Who Contributed the Maximum Amount to Tax-Deferred Retirement Plans in 1997 |
A-1. |
Contributions to Individual Retirement Accounts, by Deduction Status and Deductibility |
A-2. |
W-2 Forms Added, Deleted, and Modified |
A-3. |
Deferred Compensation by Implied Type of Plan |
B-1. |
Number of Workers Eligible for Tax-Deferred Retirement Saving in 1997 |
B-2. |
Percentage of Workers Contributing to 401(k)-Type Plans in 1997 |
B-3. |
Percentage of Workers Contributing to Individual Retirement Accounts in 1997 |
B-4. |
Percentage of Workers Participating in Any Tax-Deferred Retirement Plan in 1997 |
B-5. |
Average Employee Contribution to a 401(k)-Type Plan in 1997 |
B-6. |
Average Employee Contribution to an Individual Retirement Account in 1997 |
B-7. |
Contributions to Individual Retirement Accounts by Nonearning Spouses in 1997 |
C-1. |
Workers' Participation in 401(k)-Type and Noncontributory Plans in 1997 |
C-2. |
Total Participation by Workers in Tax-Deferred Retirement Plans in 1997 |
C-3. |
Average Contributions to Defined-Contribution Plans in 1997 |
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Figures |
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1. |
Private-Sector Workers Covered by Employment-Based Retirement Plans |
2. |
Number of Active Participants in Private-Sector Plans, by Type of Plan |
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