Boehner Bill Includes RMD Provision

A provision of the Savings Recovery Act of 2009 (H.R. 2021) would extend the suspension of required minimum distribution (RMD) requirements through 2012.

The bill, sponsored by U.S. Representative John Boehner (R-Ohio) and 31 co-sponsors, has been referred for further action to the Subcommittee on Health, Employment, Labor, and Pensions (see “GOP Congressmen Offer Savings Proposal”).

Among other things, the proposed bill would raise the contribution and catch-up limits for individuals and families, extend the existing SAVER’s Credit to contributions made to 529 college savings accounts, double the Social Security earnings limit from $14,160 to $28,320, and allow more Americans to increase their income without being hit by the Social Security earnings penalty.

On the U.S. Senate side, S. 157, that would waive RMD payments through 2010, has been sent to the Finance Committee for further deliberation. It was sponsored by U.S. Senator Olympia Snowe (R-Maine) (see “Two RMD Delay Bills Filed”).

A bill signed into law by former President George Bush suspended for 2009 the requirement that individuals 70 1/2 and older must withdraw a minimum amount from their 401(k) plans or IRAs or face a 50% penalty on the amount that should have been withdrawn (see “Bush Signs RMD, Pension Relief into Law”).