In order to encourage taxpayers to make provision for their pensions various incentives are provided by the tax system. The US Government Accountability Office (GAO) has however reported that the number of new pension plans taken out by individuals in the private sector has not increased in spite of attempts to stimulate individuals to do more in this area. The federal tax rules permitting US citizens to defer taxes in relation to their pension contributions in some cases until the funds are withdrawn from the plan after retirement are expensive for the US government because they give rise to a loss in tax revenue collected. The number of employer-sponsored pension plans has however decreased between the years 2009 and 2011, according to the GAO report, In the course of the 3-year period from 2009 to 2011, 115,000 pension plans were ended by private-sector employers and there were approximately 52,000 fewer private single-employer pension plans in 2011 than there had been in 2000. The GAO report therefore appears to highlight a potential problem for US citizens who may not be doing enough to provide for their retirement.
