AICPA comments on simplifying employer-provided retirement plan rules.

• Author: Winton, Lisa A.

The AICPA has recently submitted comments on the President's FY2004 budget proposal to simplify the employer-provided retirement plan rules. It applauds this effort in general, and particularly commends the efforts to consolidate the variety of retirement plan options into a single benefits structure. However, the AICPA is concerned that these simplification efforts may have unintentional, broadly applicable consequences.

The proposed changes do not encourage small employers to offer retirement savings plans to their employees, but may encourage those that currently offer retirement plans to terminate them. This would thwart the Administration's goal of promoting more retirement savings.

The Administration's proposal would create three new retirement savings accounts: (1) Retirement Savings Accounts (RSAs); (2) Lifetime Savings Accounts (LSAs); and (3) Employer Retirement Savings Accounts...