SHRM Advocates on Fiscal Issues during Capitol Hill Visit

Nov 13, 2012

HR executives support protection of tax advantages for employee benefits

Washington, D.C., Nov. 13, 2012 — Hundreds of members of the Society for Human Resource Management (SHRM) will visit Capitol Hill on Thursday, Nov. 15, to support the tax-deferred status of employee benefits.

SHRM — the world’s largest association representing the HR profession — believes that a comprehensive and flexible set of benefits is a critical tool for employers as they recruit and retain talented employees.

Tax-exempt benefits such as educational assistance, retirement savings and health care are expected to come under scrutiny as Congress considers tax reform and efforts to reduce the deficit. SHRM advocates a “do no harm” approach to employee benefits during congressional negotiations that are expected this fall and into 2013.

“SHRM understands the challenges facing America’s workforce. We support policy measures that enable employers to remain competitive and innovative. In a vigorous global marketplace, HR professionals need every tool possible to create the skills and resources that make U.S. employers the building blocks of a thriving economy,” said Henry G. (Hank) Jackson, SHRM’s president and CEO.

SHRM, with members in all congressional districts, is coordinating a Hill Day that is expected to attract about 375 human resources executives from across the country. In meetings, they will tell their lawmakers:

  • Employer-provided education assistance, or Section 127 of the federal tax code, supports a skilled workforce by allowing an employee to exclude from income up to $5,250 a year in tuition reimbursement for undergraduate and graduate-level courses. Section 127 should be made a permanent part of the tax code.
  • Employer-provided retirement plans, including pensions and 401(k)s, are a key component of our country’s retirement system. The government should facilitate savings by employees by encouraging voluntary employer-sponsored plans through tax incentives to employers and individual savings accounts.

Employer-provided education assistance, Section 127

Section 127 of the Internal Revenue tax code will expire on Dec. 31 with the Bush-era tax cuts unless Congress takes action. Established in 1978, the provision has been extended by Congress 10 times, most recently in 2010.

About 1 million American workers use tuition reimbursement. With top majors including science, technology, engineering and mathematics, employer-provided education assistance is invaluable at a time when employers face increasing global competition and a shortage of skills in critical areas, HR executives say.

“The temporary status of employer-provided tuition assistance causes confusion for employees who can’t rely on the tax-free benefit and for employers as they manage payroll systems and career-development programs,” said Mike Aitken, SHRM’s vice president of government affairs. “It’s time to turn confusion into certainty and make Section 127 a permanent part of the tax code.”

While on Capitol Hill, SHRM members will support efforts by U.S. Rep. Sam Johnson, R-Texas, and Rep. Richard Neal, D-Mass., who introduced the Employee Educational Assistance Act of 2012 (H.R. 4137) to include Section 127 in an extension of tax cuts.

Employer-sponsored retirement plans

Together with Social Security and personal savings, employer-provided retirement plans offer significant retirement benefits for workers. About 670,000 private-sector defined contribution plans (IRAs and 401(k) plans) cover 67 million participants, and more than 48,000 private-sector defined benefit plans (pension plans) cover 19 million participants.

“Every American should be given the opportunity to save for retirement,” said Kathleen Coulombe, SHRM government affairs associate. “Significant changes to the tax treatment of retirement plans will adversely impact their ability to prepare for retirement.”

Among the offices being visited are Rep. Richard Neal, D-Mass., Rep. Jim Gerlach, R-Pa., Sen. Richard Blumenthal, D-Conn., and Sen. Johnny Isakson, R-Ga., who introduced resolutions supporting the tax benefits of employer-sponsored retirement plans.

The Hill Day includes SHRM members attending its Leadership Conference and representatives from SHRM affiliates HR Tampa and the Morris County, N.J., SHRM Chapter.

Because HR supports investment in the well-being of employees and organizations’ business goals, SHRM chairs the Coalition to Protect Retirement and co-chairs the Coalition to Preserve Employer Provided Education Assistance.

For more information on Section 127, visit the Coalition to Preserve Employer Provided Education Assistance. For more information on retirement savings plans, visit the Coalition to Protect Retirement at

MEDIA: For more information or to schedule an interview, contact Kate Kennedy at and 703-535-6260.

About the Society for Human Resource Management

The Society for Human Resource Management (SHRM) is the world’s largest association devoted to human resource management. Representing about 260,000 members in more than 140 countries, the Society serves the needs of HR professionals and advances the interests of the HR profession. Founded in 1948, SHRM has more than 575 affiliated chapters within the United States and subsidiary offices in China and India. Visit SHRM Online at or follow SHRM at


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