IRAs and Other Savings Incentives: A Brief Overview

Publication Date: January 2005

Publisher: Library of Congress. Congressional Research Service

Author(s):

Research Area: Banking and finance

Type:

Abstract:

Several types of savings are eligible for beneficial treatment under the individual income tax, and Individual Retirement Accounts (IRAs) have received considerable attention. Pension savings are actually more important in terms of revenue loss. There are other investments that are treated favorably as well. The President has proposed in previous budgets to significantly expand IRAs. Effects of these provisions on savings are uncertain, and, despite dollar limits on contributions and income phase outs, IRAs tend to benefit higher income individuals.