Ways and Means Chairman Kevin Brady told reporters Thursday that a tax bill released next week might include an increase to the current law’s 401(k) contribution limits.
The Texas Republican’s comment comes a day after he met with President Donald Trump to discuss the issue. Trump had tweeted earlier in the week that Republicans would not touch 401(k)s in their tax overhaul bill.
“We are working together to find ways to strengthen retirement savings and help people save more and sooner, including discussions about how we increase 401(k) limits so people can save more,” Brady said Thursday. “We’ll continue that work with the White House.”
Under current law taxpayers can put up to $18,000 — after this year, $18,500 — in their 401(k)s without trigger a tax penalty until that money is withdrawn from the retirement savings accounts. Taxpayers age 50 and older can make an additional tax-free “catch up” contribution of up to $6,000.
Brady declined to say whether an increase in 401(k) limits meant an increase in those pre-tax limits, noting tax writers are “still exploring the other ideas.”
The president feels strongly about allowing people to save more money, Brady said.
“With half of Americans saving $200 or less a month, I worry that won’t be enough for their retirement and so does the president,” he said.