Pension Reform Provisions: What, When and How Much?
President Bush signed the Economic Growth and Tax Relief Reconciliation Act (EGTRRA) on June 7, 2001. The $1.35 trillion tax cut—the centerpiece of the president's agenda—includes retirement security and pension reform provisions that have been the focus of the business and benefits communities for more than four years. Transition to Lower Tax Rates Enhances Deferral Opportunities
Tax rate reductions are the heart of the Economic Growth and Tax Relief Reconciliation Act. The law creates a new 10 percent tax bracket and eventually reduces most of the other tax brackets by at least three percentage points. The new 10 percent rate is retroactive to the beginning of 2001, and applies to some income that was previously taxed at 15 percent. Benefits Legislation in the "New" Senate
In late May, Senator James Jeffords of Vermont announced his intention to leave the Republican Party, becoming an Independent instead. This switch gave Democrats a one-seat majority, putting them in control of the Senate's floor schedule and committees. Lesser-Known Tax Provisions Affect Employers, Too
The media has focused mostly on tax cuts and estate tax provisions, and the benefits community has been concerned primarily with the pension package. But the Economic Growth and Tax Relief Reconciliation Act also affects educational assistance, adoption assistance and other employer programs. Court Rules That Not Covering Prescription Contraceptives Violates the PDA
In a case of first impression, a federal district court in Seattle ruled in Erickson v. Bartell Co. that an employer violated the Pregnancy Discrimination Act (PDA) by not covering prescription contraceptives under the group health plan. This ruling specifically affects employers in the western district of Seattle—but may reveal a trend in cases to come.
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