Anticipated Retirement Policies under the Second Trump Administration

Federal lawmakers have successfully passed the Social Security Fairness Act, which is now headed to President Joe Biden for his expected signature. The Act eliminates two provisions—the Windfall Elimination Provision and the Government Pension Offset—that prevent nearly three million people from collecting their full Social Security benefits. Previously, police officers, firefighters, teachers, and other public service workers could collect only reduced Social Security benefits because they have public pensions. Senators and representatives from both parties have praised the bill as a monumental victory for working-class people who have paid into and earned their full Social Security benefits.

Now, lawmakers are looking ahead to further expand access to retirement savings for Americans, perhaps through a SECURE 3.0 Act. Such an Act could include easing the rollover process, creating default investments in retirement plans, and generally increasing retirement coverage for more workers.

Furthermore, president-elect Trump is widely expected to extend the 2017 Tax Cuts and Jobs Act, which is scheduled to expire at the end of 2025. If extended, these tax cuts will increase retirement savings due to increased disposable income. However, if Congress allows this legislation to expire, taxes on withdrawals from retirement accounts may rise.

The Trump administration previously supported corporate tax cuts, which tend to improve the stock market. In turn, stock market boosts can lead to growth in retirement portfolios.

Despite these gains, some worry that expansions in tax cuts will necessarily result in reductions in federal spending. The concern is that future retirees will ultimately bear the consequential negative impact on the Social Security system.

In addition, the U.S. Department of Labor has launched the Lost and Found Database designed to help individuals locate missing or forgotten retirement accounts. However, participation in the database is purely voluntary and will cover only Americans over 65, substantially limiting its effectiveness.

HBL has experience in all areas of benefits and employment law, offering a comprehensive solution to all your business benefits and HR/employment needs. We help ensure you are in compliance with the complex requirements of ERISA and the IRS code, as well as those laws that impact you and your employees. Together, we reduce your exposure to potential legal or financial penalties. Learn more by calling 470-571-1007.

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Hall Benefits Law, LLC

HBL offers employers comprehensive legal guidance on benefits in mergers and acquisitions, Employee Stock Ownership Plans (ESOPs), executive compensation, health and welfare benefits, healthcare reform, and retirement plans. We counsel a wide spectrum of clients including small, mid-sized, and large companies, 401(k) investment advisors, health insurance brokers, accountants, attorneys, and HR consultants, just to name a few. HBL is passionate about advising clients, and we are dedicated to our mission: to provide comprehensive, personalized, and practical ERISA and benefits legal solutions that exceed client expectations.

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