• GOP leader offers little clarity on 401(k) plan,

House Republicans’ taxoverhaul bill will raise the amounts that American workers can contribute to their 401(k) retirement accounts, House Majority Leader Kevin McCarthy said Sunday — but he offered no answer to an important question for many savers:

Will the bill reduce the annual contributions that savers can make from their pretax income while increasing their after-tax limits?

Current law sets the combined limit at $18,000, or $24,000 for workers over 50; those limits will increase slightly in 2018.

At the same time, the Republican effort to overhaul the tax code suffered a bruising setback over the weekend when a powerful corporate interest group — the National Association of Home Builders — came out against the proposal. And Sen. Ron Wyden of Oregon and other Democrats are already attacking the legislation as a bait-and-switch in the hopes that they can find a path forward to a bipartisan tax bill that they believe will truly benefit middle-class Americans.

The answer to the 401(k) question carries important implications for the popularity — and the viability — of the tax bill that House leaders plan to release Wednesday. President Donald Trump pointed out the political risk of fiddling with the retirement plans in a tweet: “There will be NO change to your 401(k),” he said Monday. “This has always been a great and popular middle class tax break that works, and it stays!”

But House Republicans — scrambling for ways to raise revenue that would offset the deep tax-rate cuts they’ve proposed for businesses and individuals — haven’t embraced the red line Mr. Trump tried to set. And lobbyists who want to preserve the current system have heard that tax writers may set a cap as low as$2,400 on pretax contributions, while increasing the after-tax limits. The effect would be to increase workers’ upfront taxes on retirement-savings.

Giant asset managers fear that imposing such low limits on the tax-deferred savings plans would reduce the American public’s savings rate. As of June 30, 401(k) plans held an estimated $5.1 trillion.

Mr. McCarthy did little toc lear up the matter.

“We’re going to raise the amount you can put in” a 401(k), he said on Fox News’ “Sunday Morning Futures” program. He also said: “And if you can do it and not be taxed later on, there is a way to make Americans more self-insured, have greater resources.”

The phrase “not be taxed later on” suggests that Republicans are considering increasing after-tax contribution limits for so-called Roth 401(k) plans. Workers who use the Roth option pay taxes on their income before making the contributions to their accounts. Then they receive tax-free distributions in retirement.

“So the way we’ll look at the 401(k), we will protect it, we’ll expand the amount that you can invest, but we’ll also give you an option to actually not be taxed later in life, not to have that tax burden hovering over you in the future but actually have greater income in the future,” Mr. McCarthy said.

House leaders have yet to confirm any change for the pretax contributions.