Tax reform offers incentive for companies to accelerate pension contributions

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By Milliman Employee Benefits Research Group | 23 March 2018
The enactment of the Tax Cuts and Jobs Act (TCJA) at the end of 2017 reduced the corporate tax rate from 35% to 21%. Although the TCJA contained no provisions directly affecting defined benefit plan funding or maximum deductibility, its corporate-rate reduction produces an incentive for pension plan sponsors to accelerate their contributions, thereby maximizing the tax effectiveness of the deductions for the 2017 plan year.