HR 9813: To amend the Internal Revenue Code of 1986 to impose limitations on high-income taxpayers with large retirement account balances.

HR 9813 in plain English: This bill would amend the Internal Revenue Code to place new restrictions on high-income taxpayers who have accumulated large retirement account balances. It targets individuals with retirement savings above $10,000,000 and applies income thresholds starting at $400,000 depending on filing status.

Stated purpose

The bill aims to limit how much high-income taxpayers with large retirement account balances can contribute each year to individual retirement plans, by capping new contributions once total retirement savings reach $10 million.

Key points

• Imposes new limitations on retirement accounts once balances exceed $10,000,000
• Income thresholds for the restrictions start at $400,000 for single filers, $450,000 for married filing jointly
• Sets a $225,000 threshold for married individuals not filing jointly and $425,000 for heads of household
• Requires the IRS Secretary to issue regulations to implement the new rules

Arguments supporters make

• Tax-advantaged retirement accounts were meant to help ordinary people save, not to let wealthy individuals shelter tens of millions of dollars from taxes indefinitely.
• Capping contributions above $10 million would redirect tax benefits toward people who actually need retirement security, making the system fairer.
• Very large tax-deferred accounts allow the ultra-wealthy to avoid taxes on investment gains for decades, costing the government revenue that could fund other priorities.

Arguments opponents make

• The income and balance thresholds, while high today, are not indexed to keep pace fully with wealth growth, meaning more people could be caught by these limits over time.
• Limiting retirement contributions for high earners could discourage them from participating in retirement plans that also benefit their employees, potentially reducing benefits workers receive.
• Tax-deferred accounts encourage long-term saving and investment; restricting them—even for the wealthy—could reduce capital available for business investment and economic growth.

Tradeoffs

The bill would reduce tax benefits for a small group of very high earners in order to reclaim government revenue, but does so by adding complexity to the tax code and restricting a savings vehicle that some argue should remain broadly available without income-based caps.

Current status in Congress: In committee.

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