leading organization for assisted living providers and the residents
and families it serves is calling upon Treasury secretary
Henry M. Paulson Jr. to temporarily suspend regulations that force
seniors to withdraw money from retirement accounts.
“The decline in the stock market is devastating for seniors
who rely upon their retirement savings to pay their expenses,” said
Richard P. Grimes, the President/CEO of the Assisted Living Federation
of America (ALFA). “It is wrong to penalize these retirees a second
time by forcing them to withdraw money from depressed 401 (k)
Federal regulations require that seniors who are 70 ½ years of
age or older to withdraw a minimum amount from 401 (k) accounts each
month or else pay a tax penalty that amounts to 50 percent of the
scheduled disbursement. The amount of withdrawal was calculated upon
the total value of the account before the recent dramatic decline in
the stock market.
Retirement accounts for US consumers lost more than one
trillion dollars in value last week and almost two trillion dollars in
value in the last 15 months.
“Congress never anticipated this sort of market decline or its
impact on seniors who spent years carefully saving and planning for
retirement,” said Grimes. “Seniors who use retirement savings for
living expenses cannot afford to wait years for the market to recover.
They need some relief now.”
The two major presidential candidates, Senators John McCain of
Arizona and Barack Obama of Illinois, have called for suspension of the
tax penalties for retirees. While federal law regulates 401 (k) tax
policy, some lawmakers say that the Secretary of the Treasury has the
authority to temporarily suspend the regulation.
ALFA represents professionally managed assisted living
companies and the residents they serve. More than one million seniors
live in assisted living communities throughout the nation. Nine out of
ten residents in private assisted living communities pay for their
assisted living expenses with personal or family funds.
ALFA raises the bar for excellence and serves as the
voice for senior living. ALFA advocates for informed choice, quality
care, and accessibility for all Americans needing assistance with
About the Assisted Living Federation of
The Assisted Living Federation of
America is the largest national association exclusively dedicated to
professionally managed assisted living communities for seniors. ALFA’s
member-driven programs promote business and operational excellence
through national conferences, research, publications, and executive
networks. ALFA works to influence public policy by advocating for
informed choice, quality care, and accessibility for all
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