AICPA comments on Bush Administration's proposals on retirement plans.

• Author: Winton, Lisa
• Position: Legislation - Brief Article

The AICPA provided comments on President Bush's Fiscal Year 2005 budget proposal as it pertains to efforts to simplify the employer-provided retirement plan rules. While applauding the effort in general, the AICPA expressed its concern that the simplification efforts may have unintentional, broadly applicable consequences.

Specifically, the AICPA said that it believed the proposed changes not only do not encourage small employers to offer retirement savings plans for their employees, but may actually encourage small employers that currently offer retirement plans to terminate their retirement programs. Burdensome reporting requirements stemming from the consolidation of plans as proposed would be a likely culprit.

Moreover, the AICPA said, any proposal that requires employers to redesign their plans would likely decrease sponsorship of retirement plans among small employers. Establishing and maintaining qualified retirement plans is very costly for employers. Not only will plan documents need to be revised, the...