Among the alterations to the gift tax in the EGTRRA
was a reduction in rates.
The enhanced rules for student loan deductions introduced by EGTRRA
increased exemptions and decreased tax rates--all good changes to be sure--but at a serious cost: the introduction of uncertainty as to the long-term structure of the transfer tax.
changes became effective for plan years starting in 2002.
Other states determine their tax using the SDTC in effect before EGTRRA
and, thus, are not affected by the phase-out of the Federal SDTC.
Finally, the last paragraph that references the five-year lookback was also eliminated by the EGTRRA
President Bush has demanded that Congress pass legislation to make EGTRRA
The authors' bottom line is that EGTRRA
mitigates, but doesn't fully eliminate, the lifetime tax increases facing many low-income households from making significant contributions to tax-deferred retirement accounts.
All of the companies are aware of EGTRRA
and have communicated the new tax law's retirement savings opportunities to their employees.
2002 Tax Act Plus covers three critical pieces of legislation that affect your clients this year: Job Creation and Work Assistance Act of 2002, Victims of Terrorism Tax Relief Act, and the provisions of the 2001 EGTRRA
Tax Act that are effective for 2002.
one of our top priorities is helping our association clients adapt to this new landscape by providing complete information about how EGTRRA
affects their plan and their employees' retirement options.
Recently, congress changed some of the rules governing qualified plans with EGTRRA