Using the choices provided below, show the justification for each provision of the tax law listed.Note: In some cases, more than one answer is appropriate.

C) A deduction for contributions by an employee to certain retirement plans.

Question

Using the choices provided below, show the justification for each provision of the tax law listed.Note: In some cases, more than one answer is appropriate.
 
C) A deduction for contributions by an employee to certain retirement plans.

Quizplus · Accepted Answer

A deduction for contributions by an employee to certain retirement plans is justified by several reasons including encouraging savings for retirement, reducing the burden on social welfare systems, and promoting financial security for individuals in their old age. This deduction also serves as an incentive for employers to offer such plans as a benefit to their employees, thereby improving employee retention and satisfaction. Both choices A and B provide incentives for retirement savings and reduce the burden on social welfare systems, with A specifically referring to traditional IRA contributions and B referencing contributions to employer-sponsored plans such as 401(k)s.

Using the Choices Provided Below, Show the Justification for Each