The U.S. House of Representatives has overwhelmingly approved legislation that would sharply increase the annual contribution limits for IRAs and 401(k) plans. 

The vote was 407-24 in favor of the bill, which is called the "Comprehensive Retirement Security and Pension Reform Act of 2001" (H.R. 10).

The bill is projected to cost nearly $52 billion over 10 years, and it would enact provisions not included in President Bush's tax-cut plan. Despite the bill's strong bipartisan support, some Democrats criticized it for favoring the wealthy. 

Both the House and Senate passed a similar bill last year, and Republicans hope they can achieve the same this year, when the legislation will likely receive presidential approval.

Among other things, H.R. 10 would

• Gradually raise the contribution limit for both traditional and Roth IRAs from $2,000 to $5,000 by 2004 (workers age 50 and older could contribute $5,000 beginning next year);
• Gradually raise the annual limit on employee contributions to 401(k) and 403(b) plans from $10,500 to $15,000 by 2006;


Increase the limit on annual additions to defined-contribution plans from the lesser of 25% of compensation or $35,000, to the lesser of 100% of compensation or $40,000;

Increase the maximum annual pension benefit a retiree can receive from a defined-benefit plan from $140,000 to $160,000.