The Wisconsin Assembly today passed a bill that would bring the state's regulations of Roth Individual Retirement Account (IRA) conversions into line with federal regulations, while the State Senate narrowly approved a bill to create a new stopgap health insurance program for the working poor.
The same Roth IRA bill was approved by the state Senate last week, and the measure now awaits Gov. Jim Doyle's signature.
Tim Steffen, financial and estate planning manager for Milwaukee-based Robert W. Baird & Co. Inc.'s Private Wealth Management Group, hailed the passage of the bill.
"Without enactment of this bill, Wisconsin will be the only state in the country with restrictions on Roth conversions, allowing only taxpayers with income below $100,000 to do the conversion. In a time when all states are facing budget shortfalls, Wisconsin legislators were concerned about a Legislative Fiscal Bureau study showing that the conversion legislation would have a net negative impact on tax revenue. However, a second study has since shown that expanding Roth conversions would create a short-term revenue increase. This fact, combined with public pressure, led to the state Legislature approving these changes," Steffen said.
The bill includes a provision that maintains the amount Wisconsin taxpayers may contribute to retirement plans beyond 2010, thereby matching the federal limitations in place for next year. Without this bill, Wisconsin residents would face lower maximum contribution amounts for 2011.
"Finally, the bill also adopts a variety of retirement plan provisions benefiting members of the armed services that are part of the federal Heroes Earnings Assistance and Relief Act of 2008. Included in those items are exceptions to IRA contribution and withdrawal limitations," Steffen said.
With a 17-16 vote, the Senate approved a bill meant to serve 25,000 state residents who are on the waiting list for the BadgerCAre Core Plus program.
For ongoing coverage, visit WisPolitics.com, a media partner of BizTimes Milwaukee.
Legislature approves bills for Roth conversions and BadgerCare Basic
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