The Future


When did 401(k) plans start?

The 401(k) plans began in 1978, when Congress revised a section of the Internal Revenue Code, by adding a section called 401(k), whereby employees would not be taxed on income they direct as deferred, but only on the direct income they receive today. As a result of this important legislation, employees could now set aside a portion of their income and not pay any taxes on it until they retire. The law went into effect in 1980.


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