(MONEY Magazine) – When we asked MONEY readers in June how they felt about efforts in Congress to revive the fully deductible Individual Retirement Account, we expected a shout of approval. After all, two small random-sample surveys since 1989 had shown readers 9 to 1 in favor of restoring the deduction that Congress took away from many middle-income taxpayers in the '86 tax reform. Instead of a shout, we got a resounding roar. By early August, more than 23,000 of you had mailed back our questionnaire -- half again as many as have answered any previous MONEY survey in the magazine's 19-year history. And the vote was overwhelmingly affirmative: 97% of respondents said they would contribute to the so-called Super-IRA if it became law, and most of the remaining 3% said they wouldn't kick in only because they were already retired. The pollsters who helped us on the project say a virtually unanimous vote like that is remarkable even for a self-selected survey such as this one. Typical was the response of Jan Dean of Newport Beach, Calif., who wrote: ''My husband and I put $2,000 apiece into IRAs when they were deductible, but we now save only $300 each. We'd increase that amount immediately if IRAs were fully deductible again.'' The MONEY poll also rebutted several key arguments raised against the new IRA. For example, opponents claim that it wouldn't encourage people to add to their savings, just shift money from taxable accounts to tax-deferred ones. Not true, according to our readers, nearly four out of five of whom said they would fund their contributions entirely from earned income, not savings. The poll came as welcome news to Super-IRA proponents on Capitol Hill, where twin bills are pending in the Senate and House. ''It confirms what I'm hearing personally,'' says Delaware Republican William Roth, one of the principal Senate sponsors. ''The huge response shows the depth of feeling on this issue.'' Adds Texas Democrat Lloyd Bentsen, chairman of the Senate Finance Committee and the other chief Senate sponsor: ''Washington needs to hear how much support there is for IRAs around the country. Results like this may help get the legislation passed.'' Although the proposal is co-sponsored by 78 of 100 senators and 250 of 435 representatives, backers say that passage will depend on finding a way to make up the tax revenue lost -- an estimated $4.4 billion the first year, rising to a total of $25.8 billion over five years. MONEY readers' views on that subject are outlined below and were conveyed to the Senate Finance Committee -- along with the poll's other findings -- in recent public hearing testimony by MONEY's managing editor Frank Lalli (see Editor's Notes on page 7). If the new IRA passes, either now or perhaps in election year '92, it would undo one of tax reform's least popular provisions -- the limits on IRA deductibility. In tax years through '86, anyone with earned income could put as much as $2,000 a year in an IRA (or a total of $2,250 in separate IRAs for a wage earner and nonworking spouse) and deduct it all. Today, though, contributions are fully deductible only by someone whose employer does not offer a retirement plan or who makes less than prescribed limits -- $25,000 for singles, $40,000 for couples. The Super-IRA would restore full deductibility and then some. Every working American could put as much as $2,000 a year ($2,250 with a spousal IRA) in one or both of two types of accounts. In the first, which would resemble a conventional IRA, deposits would be deductible, earnings would grow tax deferred, and you would pay ordinary income tax on withdrawals after age 59 1/ 2. In the second, a so-called back-end IRA, you would forgo the up-front deduction in return for the right to withdraw principal and earnings tax-free, regardless of your age, once the money had been in the account for five years. With either account, you'd pay the standard 10% early-withdrawal penalty. But you could take money out at any time without penalty to buy a first home for yourself, your children or your grandchildren; to pay for post-high-school tuition (but not room and board) for yourself, your children or your grandchildren; or to cover medical expenses for yourself or a dependent that exceeded 7.5% of your adjusted gross income. The aim of the new IRA, of course, is to promote savings -- for the benefit of the economy as well as retirees. ''Americans save less than a nickel of every dollar earned,'' says Bentsen. ''We are now saving only about half what we did in the '50s, '60s or '70s.'' And while the U.S. savings rate has inched up to 4.6% since hitting a post-World War II low of 3.2% in 1987, it's still barely a third of the 13% rate prevalent in what used to be West Germany and less than a third of Japan's 15% rate. The consequences, economists agree, can be dire: a low savings rate can push up interest rates, discourage investment and slow employment and productivity growth. Is the Super-IRA the remedy? Not the only one, of course, but MONEY readers clearly want it. To assess your comments, our statisticians analyzed 1,004 randomly selected questionnaires (margin of error: plus or minus four percentage points). Among the findings:

-- Some 70% of respondents said they disagreed with the notion that penalty- free early withdrawals would undermine retirement savings, and 64% said they weren't inclined to make such withdrawals anyway. IRA proponents argue that liberalized withdrawals would actually encourage savings by easing fears about tying up money for so long, especially among young people. (In a separate poll taken in June, three-quarters of Americans in their twenties said they did not plan to open IRAs, one-third of them because they didn't want their money locked up.) -- Readers cast doubt on the claim that a Super-IRA would not offer a big enough tax incentive to boost savings. Critics have noted that after 1986, most taxpayers simply stopped funding their IRAs -- including 40% of those still eligible for full deductions. The critics say this was because the lower overall tax rates made IRA deductions less attractive. Proponents counter that the drop-off in savings resulted simply from a decline in IRA advertising. The poll supports the latter view in two ways. First, among MONEY readers, who are presumably better informed than most Americans about retirement savings, only 14% of those who could get deductions stopped contributing. Second, 97% of readers who have not put money into IRAs since '86 said they would open a Super-IRA. -- Finally, the poll contradicted the view that the new IRA would merely amount to a tax break for the rich. Support for it cut across all income levels. It got predictable endorsement from readers who are largely ineligible for IRA deductions today, including 99% of those with household incomes over $70,000 and 96% of those in the $40,000 to $60,000 range. But even among readers earning less than $30,000, most of whom can now deduct their contributions, a solid 82% said they would fund the new IRA. This broad-based support is understandable when you consider the effect of the $2,000 contribution limit. For the truly rich, that ceiling makes the IRA deduction ($620 in the 31% tax bracket) a comparative trifle. But for a couple with taxable income just over $34,000 in the 28% bracket, the $560 saved could look very attractive. And the $2,000 savings boost each year might make a big difference in later life, since the median U.S. family reaches retirement age now with liquid assets of just $7,000. Readers were divided on how to make up the revenue lost to the Super-IRA. Given a menu of options, 59% and 57% respectively ticked off ''Cut domestic spending'' and ''Cut defense spending.'' But a surprising number also favored cuts that were literally closer to home. Some 46%, for example, would restrict or eliminate the deductibility of home-equity loan interest, even though 84% of MONEY subscribers own their residences. (You can write off interest on up to $100,000 of home-equity debt today.) And 59% advocated reducing or scrapping the mortgage interest deduction on second homes, a comfort that . about 12% of subscribers enjoy. Neither move would be enough. Dumping the second-home tax break would raise only $1.5 billion over five years; no estimate exists for the home-equity tax change, though experts say it would not approach the $25.8 billion needed. Nevertheless, the poll showed readers were willing to trade other tax breaks for a new IRA. (They favored it 5 to 1 over a proposed capital-gains tax cut, for instance.) Super-IRA sponsors have not yet said how they would make up the loss. ''If you show your hand in the middle of the game,'' explains Bentsen, ''people around here will grab those options to pay for what they want.'' In their written comments, though, readers argued that the revamped IRA might pay for itself in a roundabout way. As Emily Graham of Denver put it, ''If Americans had consistent and accessible tax-encouraged ways to save, many of them would provide for themselves to a greater degree.'' In the long run, that kind of achievable self-reliance could give the country the greatest boost of all.

BOX:

WOULD YOU CONTRIBUTE TO A SUPER-IRA? 97% YES 3% NO

WHERE WOULD YOU GET THE MONEY? 79% FROM EARNED INCOME ONLY 21% WHOLLY OR PARTLY FROM SAVINGS

WOULD YOU MAKE ANY PENALTY-FREE EARLY WITHDRAWALS? 35% YES 64% NO

WHAT DO YOU LIKE BEST ABOUT THE SUPER-IRA?

63% AN UP-FRONT DEDUCTION FOR CONTRIBUTIONS 24% TAX-DEFERRED OR TAX-FREE GROWTH OF EARNINGS 12% PENALTY-FREE EARLY WITHDRAWALS