Tag: tax deferral

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What’s the Tax Advantage of 401(k)s?

Issue Brief by , , and

February 14, 2012

The brief’s key findings are: The tax deferral for 401(k) plans costs the Treasury about $50-70 billion per year. Calculating the cost requires comparing how much individuals would pay in taxes on savings within a 401(k) to how much they would pay outside a 401(k). Recent deficit reduction proposals would lower 401(k) contribution caps, which would reduc…