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history of section 219(g)(7) makes clear that Congress knew that
it was changing, and intended to change, the operative law.
E.g., H. Conf. Rept. 105-220 at 378-379 (1997), 1997-4 C.B. (Vol.
2) 1471, 1848-1849. The following passage by the Staff of the
Joint Comm. on Taxation from the General Explanation of Tax
Legislation Enacted in 1997 at 42 (J. Comm. print) also
demonstrates this fact:
Present and Prior Law
Under present and prior law, an individual may
make deductible contributions to an individual
retirement arrangement (“IRA”) up to the lesser of
$2,000 or the individual’s compensation if the
individual is not an active participant in an employer-
sponsored retirement plan. Under present and prior
law, in the case of a married couple, deductible IRA
contributions of up to $2,000 can be made for each
spouse * * * if the combined compensation of both
spouses is at least equal to the contributed amount.
Under present and prior law, if the individual (or
the individual’s spouse) is an active participant in an
employer-sponsored retirement plan, the $2,000
deduction limit is phased out over certain adjusted
gross income (“AGI”) levels. Under prior law, the
limit was phased out between $40,000 and $50,000 of AGI
for married taxpayers filing joint returns * * * .
* * * * * * *
Reasons for Change
The Congress believed it was appropriate to encourage
individual saving and that deductible IRAs should be
available to more individuals. * * *
* * * * * * *
Explanation of Provision
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Last modified: May 25, 2011