Lump Sum Distributions From Pension Plans: Recent Evidence and Issues for Policy and Research

Leonard E. Burman, Norma Coe and William Gale

National Tax Journal, 1999, vol. 52, issue 3, 553-62

Abstract: We examine preretirement lump sum distributions (LSDs) from pension plans, which have grown significantly in recent years. Most LSD recipients do not roll over the funds into qualified accounts, but the likelihood of rollover rises for larger distributions. We find evidence suggesting that tax penalties imposed in 1986 on nonrollovers by people younger than 55 raised the likelihood of rollovers among this group, but had much less effect on the likelihood that such households saved the funds, where saving includes investing in taxable assets and paying off debt. We estimate that cashouts reduce annual retirement income by up to $1,000-3,000.

Date: 1999
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (17)

Downloads: (external link)
https://doi.org/10.1086/NTJ41789741 (application/pdf)
https://doi.org/10.1086/NTJ41789741 (text/html)
Access is restricted to subscribers and members of the National Tax Association.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ntj:journl:v:52:y:1999:i:3:p:553-62

Access Statistics for this article

National Tax Journal is currently edited by Stacy Dickert-Conlin and William M. Gentry

More articles in National Tax Journal from National Tax Association, National Tax Journal Contact information at EDIRC.
Bibliographic data for series maintained by The University of Chicago Press ().