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H 3044

An Act relative to tax exemptions for contributions to a 401(k) through a sole proprietorship

194th Legislature (2025-2026) Introduced by Simon Cataldo

Bill H 3044 boosts retirement savings for Massachusetts sole proprietors by offering tax exemptions on 401(k) contributions, encouraging financial security for self-employed individuals.

Accompanied a study order, see H5313
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Bill Summary · H 3044

Summary of Bill H 3044: An Act Relative to Tax Exemptions for Contributions to a 401(k) Through a Sole Proprietorship

Purpose and Intent

Bill H 3044 aims to amend the tax code in Massachusetts to provide tax exemptions for contributions made to 401(k) retirement plans through sole proprietorships. The intent of this legislation is to encourage self-employed individuals to save for retirement by making it more financially advantageous to contribute to these retirement plans.

Key Provisions

  • Amendment to Tax Code: The bill proposes to amend paragraph (1) of subsection (d) of section 2 of chapter 62 of the General Laws. Specifically, it seeks to strike out subparagraph (D), which currently may impose restrictions on tax exemptions for contributions made to 401(k) plans by sole proprietors.
  • Tax Exemptions: By removing this subparagraph, the bill is expected to enhance the tax benefits available to sole proprietors who contribute to their 401(k) plans, potentially allowing for greater retirement savings.

Affected Parties

  • Sole Proprietors: The primary beneficiaries of this bill are individuals operating as sole proprietors in Massachusetts. The proposed tax exemptions would provide them with increased incentives to contribute to their retirement savings.
  • State Revenue: The bill may have implications for state tax revenue, as increased exemptions could reduce the taxable income of sole proprietors.

Procedural Aspects

  • Introduced Date: The bill was introduced on February 27, 2025.
  • Committee Referral: It has been referred to the committee on Revenue for further consideration.
  • Hearing Scheduled: A public hearing is scheduled for November 18, 2025, from 10:00 AM to 1:00 PM in room A-1, where stakeholders can provide input on the bill.

Conclusion

Bill H 3044 represents a legislative effort to support self-employed individuals in Massachusetts by enhancing the tax benefits associated with retirement savings through 401(k) plans. By removing existing restrictions, the bill aims to promote financial security for sole proprietors as they plan for their retirement. The upcoming hearing will provide an opportunity for discussion and evaluation of the bill's potential impacts.

Compiled from official sources — confirm details with the bill’s official record.

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