Helping Those Workers Who Want to Cut Back
Wall Street Journal Online (06/30/02) p.360; Greene, Kelly

According to the Employee Benefit Research Institute, over half the worker population plans to keep working after official retirement, with reduced hours, but many employers fear that phased-retirement programs could conflict with the tax code, which provides tax breaks for employers who offer retirement plans. The code requires workers who have not achieved a plan's full retirement age to retire completely before receiving pension benefits, and another potential problem lies in the fact that most traditional pensions are based on the last few years of a worker's salary, so working part-time could reduce retirement pay. Nevertheless, demand for phased retirement will likely increase, and the Internal Revenue Service and the Treasury Department are looking for ideas on how to make the concept work.


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