A Closer Look at the IRAs in State Automatic Enrollment IRA Programs
46 Pages Posted: 18 Mar 2017
Date Written: December 2016
The United States faces a serious retirement savings funding gap. In an effort to fill that gap, a number of states and municipalities have begun to consider, and in some instances adopt, automatic enrollment IRA programs. Indeed, between September 2012 and June 2016, five states enacted state automatic enrollment IRA programs.
This Article takes a closer look at the IRAs in these state programs. It begins by providing an overview of the state laws creating automatic enrollment IRA programs. It then discusses the requirements that the state programs must satisfy in order to qualify as IRAs for purposes of the Internal Revenue Code and how effective the state programs are in satisfying these requirements. Finally, it concludes by discussing the distinction between Roth and traditional IRAs and which type of IRA is best suited to serve as the default IRA.
Keywords: IRA, IRAs, automatic enrollment, state, retirement, retirement savings, automatic enrollment IRAs, federalism, Internal Revenue Code, Oregon, Connecticut, Maryland
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