Who Takes Advantage of Tax-Deferred Savings Programs? Evidence From Federal Income Tax Data

David Joulfaian () and David Richardson

National Tax Journal, 2001, vol. 54, issue 3, 669-88

Abstract: This paper provides insight into the attributes of wage-earning households that participate in tax-deferred retirement savings plans. Examining data from federal tax returns, we find that approximately 52 percent of individuals and 55 percent of households participated in a retirement savings program in 1996. Excluding households with wages within the 1996 poverty thresholds and individuals under age 21 or over age 70, the age-wage restricted participation rates were 66 percent and 79 percent for individuals and households, respectively. Estimating probit equations, we find that households with a single-earner or having dependents are less likely to participate in a plan. Higher wage-earnings, non-labor income, and marginal tax rates tend to increase the probability of participation.

Date: 2001
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Persistent link: https://EconPapers.repec.org/RePEc:ntj:journl:v:54:y:2001:i:3:p:669-88

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