WH Quickly Clarifies: Actually, Tax Plan Won’t Impact 401(k) Tax Exempt Status

Jon Elswick/ELNJS

The White House on Thursday quickly corrected reports that it was proposing changes to the tax treatment of 401(k) retirement plans.

The confusion seemed to arise from CNBC’s Eamon Javers, who asked White House spokesperson Sean Spicer during his daily press briefing about the Trump administration’s detail-free tax proposal and its treatment of “401(k)s and particularly tax deductions surrounding those.”

“Does he imagine removing those deductions entirely along with the other deductions, or is he going to protect those?” Eamon asked.

Spicer responded that “the current plan, right now, both protects charitable giving and mortgage interest and that’s it.”

However, contributions to 401(k)s are not currently tax-deductible. Rather, they are excluded from taxable income in the first place.

“Sean was referring to deductions,” White House spokesperson Natalie Strom told TPM in an email. “Retirement savings is an exemption not a deduction.”

Though there has been intense speculation about the fate of 401(k)s under the new proposal, no administration official has proposed changing their tax treatment yet, press conference confusion aside.

ABOUT THE AUTHOR

Matt Shuham is a news writer for TPM. He was previously assistant editor of The National Memo and managing editor of the Harvard Political Review. He is available by email at mshuham@talkingpointsmemo.com and on Twitter @mattshuham.
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