Bill Overview
Title: Retirement Tax Credit Parity for Cooperatives and Charities Act
Description: This bill allows an individual taxpayer who is eligible to participate in in a CSEC defined contribution pension plan a new tax credit for 10% of employer retirement savings contributions not exceeding $1,000 in a taxable year.
Sponsors: Rep. Kind, Ron [D-WI-3]
Target Audience
Population: Individuals eligible for CSEC defined contribution pension plans, primarily employees of cooperatives and charities
Estimated Size: 2000000
- The bill targets individuals eligible to participate in a CSEC (Cooperative and Small Employer Charity) defined contribution pension plan.
- These plans are generally maintained by small businesses such as cooperatives and charities.
- The target population is individuals employed by cooperatives and small charities, as they are likely the ones eligible for the CSEC plan.
- CSEC plans cover a smaller portion of the workforce compared to general 401(k) or other employer retirement plans.
- The global number of individuals working in cooperatives and small charities is substantial but limited compared to mainstream corporate employment.
Reasoning
- The bill targets individuals working in cooperatives and charities, a small but significant portion of the U.S. workforce. Budget considerations require focusing on cases where the policy's impact can be significant without overspending the allocated limit.
- The policy is likely to benefit individuals in lower income brackets more significantly, as they are more common in cooperatives and small charities and can benefit more from the retirement savings boost.
- Assessing a range of individuals from varying backgrounds who are both directly impacted and not impacted provides a broader perspective on the policy's efficacy.
- Considering the $1 billion budget in the first year, supporting $1,000 per individual, potentially 1,000,000 individuals could benefit. But real impact also depends on individual circumstances such as existing contributions, making the reach likely smaller.
Simulated Interviews
Non-profit Program Coordinator (Portland, OR)
Age: 28 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 20.0 years
Commonness: 6/20
Statement of Opinion:
- I think this policy could really help people like me save more for retirement, as our budgets are often tight.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 7 | 5 |
| Year 10 | 8 | 5 |
| Year 20 | 8 | 5 |
Credit Union Manager (Burlington, VT)
Age: 48 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 15.0 years
Commonness: 4/20
Statement of Opinion:
- It's a step in the right direction, making retirement savings more accessible for those in cooperative settings.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 8 | 7 |
IT Specialist (Austin, TX)
Age: 35 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 5/20
Statement of Opinion:
- This policy might encourage me to contribute more regularly, which I haven't been doing consistently.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Retired Teacher (Des Moines, IA)
Age: 50 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 0.0 years
Commonness: 2/20
Statement of Opinion:
- I wish this policy had been around earlier in my working years.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 5 | 5 |
| Year 3 | 5 | 5 |
| Year 5 | 5 | 5 |
| Year 10 | 5 | 5 |
| Year 20 | 5 | 5 |
Social Worker (Seattle, WA)
Age: 38 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 7/20
Statement of Opinion:
- Glad to see support for retirement savings, but as a part-timer, it might not help me much.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 6 | 5 |
| Year 20 | 5 | 5 |
Charity Executive Director (Indianapolis, IN)
Age: 60 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 3/20
Statement of Opinion:
- This policy may influence our organization's decisions regarding employee benefits.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 7 | 7 |
Healthcare Worker (San Francisco, CA)
Age: 42 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 2.0 years
Commonness: 8/20
Statement of Opinion:
- Any bit helps, but my priority remains my children's education and immediate family needs.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 6 | 5 |
| Year 20 | 5 | 5 |
Freelance Artist (Denver, CO)
Age: 29 | Gender: other
Wellbeing Before Policy: 5
Duration of Impact: 3.0 years
Commonness: 7/20
Statement of Opinion:
- An opportunity, if I can get my income stable enough to contribute more steadily.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 5 | 5 |
| Year 3 | 5 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 5 | 5 |
Accountant (Miami, FL)
Age: 52 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 7.0 years
Commonness: 2/20
Statement of Opinion:
- A useful incentive; it might open up small but valuable savings incentives for co-op employees.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 8 |
Researcher (Chicago, IL)
Age: 33 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 4/20
Statement of Opinion:
- I may benefit from this kind of policy in the future when I can focus more on retirement savings than debt.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 6 | 6 |
Cost Estimates
Year 1: $1000000000 (Low: $800000000, High: $1200000000)
Year 2: $1000000000 (Low: $800000000, High: $1200000000)
Year 3: $1000000000 (Low: $800000000, High: $1200000000)
Year 5: $1000000000 (Low: $800000000, High: $1200000000)
Year 10: $1000000000 (Low: $800000000, High: $1200000000)
Year 100: $1000000000 (Low: $800000000, High: $1200000000)
Key Considerations
- The exact number of eligible individuals and take-up rate can vary based on economic conditions and awareness of the tax credit.
- The bill aims to provide parity with larger employer retirement contributions, potentially improving retirement security for individuals in cooperatives and charity roles.