Minimum Wage Bill Accrues Tax Breaks, Pension Reform

October 1996
Journal of Financial Planning;Oct96, Vol. 9 Issue 5, p94
Academic Journal
The article states that the implementation of Minimum Wage Bill increases the Tax Breaks and Pension reforms. A large number of tax changes-and breaks- that allowed a normally dead-locked Congress to agree to the controversial wage hike. While the press focused on the debate over a 90-cents-an-hour wage increase, financial planner's clients cart potentially benefit from hundreds of thousands of dollars in new savings and pension reforms. There are many changes affecting financial planners or their clients in the new law. While the Internal Revenue Service continues to have broad authority to determine whether an employer-employee relation, exists, Congress has perhaps started to chip away at some of this discretionary authority through some minor changes in the Small Business Job Protection Act of 1996. Applicable to new tax years after 1996 spouses are eligible for full revenue deductions on joint returns. The 15-percent excise tax also shall not apply to excess distributions made from defined benefit and contribution plans during 1997, 1998 and 1999.


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