There are a number of interesting proposals in the 2015 budget offered by President Barack Obama that could help American families save for retirement. Here are three of them that aren't controversial and could actually find bipartisan support.
Extend the earned income tax credit to allow people ages 65 and 66 to claim it. If you don't have children, you can currently only claim the earned income tax credit if you are younger than age 65 and have an income that is less than $14,790 for singles and $20,290 for married couples filing jointly. If you are older than 65, you don't qualify even if you are still working.
This proposed change would allow people who don't claim Social Security until full retirement age at 66 or 67 to qualify for the earned income tax credit, and it would increase the income limits to $18,070 for single taxpayers and $23,750 for married taxpayers filing jointly, as well as index these levels for inflation. This would help low-income workers stay on the job and maximize their Social Security -- a retirement planning bonus.
Require small employers to offer automatic retirement savings plans with payroll deduction. The proposal includes paying some of the employer's expenses to start up the plan. Among low-income workers, money contributed to the plan would likely qualify for the "saver's tax credit," which would increase a worker's contribution. This would encourage more people to save for retirement, and that benefits us all.
Allow all inherited spousal and non-spousal IRAs to be rolled over into the new owner's account within 60 days. This proposal essentially says the rules are confusing enough without making a distinction between the two and recommends treating these rollovers the same. This would be good for people who have lost a loved one and who have enough challenges in their lives.
These aren't big changes, but they could make an important difference in some older people's lives.