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The Administration and its Treasury Department have launched a barrage of guidance designed to increase retirement savings. Three revenue rulings, four notices, and new IRS website explanations make it easier for employees to provide for automatic retirement plan enrollments and automatic contribution increases, permit unused leave to be converted into retirement savings, give employees a clearer understanding of rollover options, and permit income tax refunds to be used to purchase U.S. Savings Bonds. The Administration also pressed Congress to adopt proposals calling for automatic IRAs where employers don’t offer retirement plans, along with matched retirement savings for lower income workers.

The new developments will, to be sure, make it easier for employers to offer automatic enrollments, and enhance the chances that taxpayers won’t spend their lump-sum payouts. However, the real trail blazers are the ruling that permits the dollar value of unused paid time off to be contributed to a 401(k) plan, and Treasury’s new policy of allowing taxpayers to funnel tax refunds directly into U.S. Savings Bonds.

Source: RIA Checkpoint Newsstand 9/9/09


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