While these proposed tax changes are working their way through the Senate, there is still a question whether they will become reality this year. Election-year politics in Congress may delay passage, and President Bush, having just vowed to cut taxes if elected to a second term, may not look kindly on a tax bill that raises some revenue to make up for revenue lost to many proposed benefits.

Now only individuals who earn less than $25,000 a year, or couples who earn less than $40,000, may contribute up to $2,000 annually to an IRA and pay no income taxes on the contribution. (These funds are taxed when withdrawn after age 59 1/2.) Legislators propose raising the income limit in 1994 to $80,000 for individuals and $120,000 for couples, which would exclude only the top 2 percent of income earners from participating in fully deductible IRAs.

The bill also proposes a new kind of IRA, a "back-loaded" fund, which would allow individuals to contribute to an account, pay taxes on the contributions when they are made, but withdraw the investment income-tax-free after five years. If you contributed $2,000 to such an IRA, you would pay regular income taxes on the initial contribution. After five years, when the fund had grown to, say, $2,500 because of accrued interest, you could withdraw the entire $2,500 without further tax liability, making the extra $500 tax-free.