Retirement Policy Directions in 2017 and Beyond

With a new Congress and a new president in Washington, how are U.S. retirement policies likely to change? Possibly quite radically, and for two main reasons. First, because of the new majority’s plans to overhaul the entire U.S. tax structure and federal budget in ways that could fundamentally change how private-sector retirement plans are treated in the tax code. Retirement, as a stand-along issue, is no longer a high legislative priority in Washington. And second, because of the drive to simplify and lower income tax rates, tax-favored retirement provisions in the tax code are vulnerable. As one of the top sources of “revenue foregone” by the federal government, ending or reducing current tax breaks for employment-based retirement plans (particularly 401(k)s) would free up revenue for other things the new Congress and president want to do. These and other issues were discussed at the Employee Benefit Research Institute’s December 2016 policy forum in Washington, DC, which brought together more than a hundred policy experts to discuss “Retirement Policy Directions in 2017 and Beyond.” A panel of 10 specialists, including industry representatives, former government officials, think-tank leaders and EBRI researchers, discussed the state of the U.S. retirement system today and what they think the future is likely to hold. This paper provides a synopsis of the policy forum discussion.