Two bills have been introduced in the Senate that would, respectively, raise the required minimum distribution age in tax-deferred retirement plans and increase the individual retirement account contribution limit.
Sen. John Kennedy, R-La., on Monday introduced the Keeping Your Retirement Act and the Increasing Retirement Amount Act. Versions of each bill are included in broader bipartisan retirement security packages that were recently introduced in Congress.
The Keeping Your Retirement Act would raise the age at which individuals are required to begin withdrawing a percentage of their tax-deferred retirement plan to 75 from 72.
By raising the age of mandatory withdrawals, the bill would give seniors more time for their retirement savings to grow before they are required to make annual withdrawals that can deplete their savings and increase their tax liability, according to a news release from Mr. Kennedy.
Mr. Kennedy's bill has an effective date of Dec. 31. In the Securing a Strong Retirement Act of 2021, a bill reintroduced in May by the leaders of the House Ways and Means Committee — Chairman Richard Neal, D-Mass., and ranking member Kevin Brady, R-Texas — the required minimum distribution age increase to 75 from 72 would take place gradually over a decade.
Separately, the Increasing Retirement Amount Act would increase the IRA contribution limit to $12,000 per year from $6,000, and for people 50 and over who do not have a workplace retirement plan, the contribution limit would rise to $15,000 per year.
The Retirement Security and Savings Act, which was reintroduced in May by Sens. Rob Portman, R-Ohio, and Ben Cardin, D-Md., includes a provision to raise the $6,500 catchup contribution for those over age 60 to $10,000.
"Louisianians work hard every year to prepare to retire responsibly and enjoy the fruits of their labor," Mr. Kennedy said in the news release. "They deserve to have more control over their own retirement plans, and that means limiting how much the government meddles here. I introduced these bills to give hardworking Louisianians the freedom to save more of their money on their own terms."