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Keywords

ERISA, Pension Reform Act of 1974, Tax

Abstract

The Employee Retirement Income Security Act of 1974 (commonly known as the Pension Reform Act and sometimes cited as ERISA) introduced a massive set of new rules for the private pension plan system. Many sections of the Pension Reform Act- such as those dealing with participation, vesting, funding, joint and survivor annuity payments, and the prohibitions against self-dealing- are treated in both the labor law and tax law provisions of the Act. This article concentrates on highlighting those sections of the Act which are treated exclusively in the tax law provisions- namely, those dealing with HR-10 and Subchapter S restrictions, individual retirement arrangements, maximum limitations on contributions and benefits, and the taxation of lump sum distributions. The article observes that the tax aspects of the Act are pervasive, technical, and in many instances, obscure, but that they will further the cause of strengthening the private pension system. The article also aims to shed light on the dramatic improvement in the lot of the self-employed.

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