Skip to comments.Clinton Administration 401k Proposed Tax? (vanity)
Posted on 03/18/2013 8:16:28 PM PDT by FreedomPoster
There are any number of places on the web referring to a Clinton Administration-era proposal for a "one-time" (yeah, don't get me started, either) tax on 401(k) assets of 15%. There are plenty of them are here at Free Republic. Boortz does it. The list goes on and on.
What I cannot find is anything really reference-able on the subject. "Boortz said it" or "xyz on Free Republic said it" really just doesn't cut it.
Does anyone here have a real source on this?
Any help on this?
I too have had no luck in sourcing this story however.
That’s nice, but I don’t see how it is helpful on my specific question.
Sounds like some un-sourced rumor that Rush talked about on his show in 1990s,.
Good luck, it doesn’t sound real.
Go here, there are over 8 million hits ...
Not so. I found something here:
Private Nest Eggs Don’t Make Public Safety Nets
“President Clinton installed Alicia H. Munnell, a vociferous advocate of pension taxation, as Assistant Treasury Secretary for Economic Policy. She wants to invest pension funds in public infrastructure and public education to “increase the resources available for future generations.” To achieve her goal, she devised a plan that requires taxpayers to report as taxable income the contributions that they and their employers make to pension plans, along with the earnings on the pension investments known as the “inside buildup.” To make up for not taxing pensions in the past, she wants to confiscate 15% of all pension fund assets.”
Still not a quotable source, but I tend to believe it:
use some of the key words in the article to search
If there is a video archived of it, I watch Dick Gephart on Washington Week (C-Span), during the clinton malaise, explain how the fed should takeover all retirement and 401K accounts for individuals because individual investors can’t manage their funds well enough for their retirement ahead. He was dead serious and even expalined that democrtas had a working plan on how to accomplish it and ‘secure the individual’s money for them’. The short guy with the round head who handles presidential debates sometimes was the C-Span interviewer. I cannot recall his name at this moment.
"However, Munnell seems to have changed her position since 1983. Now an assistant secretary at Treasury and a possible nominee for the Board of Governors of the Federal Reserve Board, she has recently attacked the tax deductibility of pension benefits by proposing as a source of new government revenue a 15 percent tax on all private pension funds.(71) "
71 refers to this (71) "The Ultimate Raid," Wall Street Journal, May 9, 1995, p. A20. See also Donald Lambro, "Risky Clinton Plan for Pension Funds," Washington Times, May 8, 1995, p. A22.
All these years I blamed Laura Tyson.. I could have sworn it was her.
BTW, I did not read all this but it looks to be very close.
Another oft-cited evidence of this is Congressional Committee testimony of Teresa Ghilarducci back in 2008, who wants to replace 401K's with mandated investment in government bonds. She's a "professor of economic-policy analysis at the New School for Social Research in New York". Do a little bit of research on this "university", and it will tell you all you need to know about her.
She claimed that the committee chairmen (Miller and McDermott) wanted to pursue her proposal. But, nothing has come of it. I suspect that cooler heads prevailed among the Democrats. They know what would happen if they tried to make that kind of change to 401K's.
BTW, did you know that McDermott is the only board-certified medical doctor in Congress that is a Democrat? All the others are Republicans. Even more interesting is that he is a psychiatrist -- the only one in Congress.
And he's batshit crazy.
Ah, the irony...
Obama stated it in 2008 before the election.
If they tax me now on my current 401K balance, and then forgive all taxes when the remaining balance is withdrawn in the future, then I might be okay with this?
LOL....like that would ever happen
You can do that now. It’s called Roth IRA. I’ve looked at it, but I do not trust them to keep their end of the bargain. They’ll change the rules later on and begin taxing withdrawals.
One of the old-time rules of accountants is to ALWAYS defer taxes TODAY if you can. You never know what rule changes may occur in the future.
Obama stated it in 2008 before the election....Horse dooky. Jesse Jackson has been floating this idea since MLK was blasted. “Take the private plans, invest it in the government and divide it up between the people who earned it and those who can’t afford it.” It would be like SS; those who actually paid into it only get the dregs from those who didn’t, and then only as long as it lasts.
If they tax you now on your 401K, you won’t have enough to withdraw later when it ain’t worth spit.
It doesn’t matter if she’s actually said it already. Now that they want to tax savings in Cyprus, all the libs here will want to do it too.
The advantage to a Roth is that you can withdraw principle without penalty. That’s what I plan on doing if the Cyprus grumblings reach here. In retrospect, I wish I’d have taken my retirement cash and buried into the ground. The government can no longer be trusted not to confiscate private property.
yeah they only tax you “one time” and you get the rst of your money.... in good time ...maybe in the form of govt IOU’s
you believe that and maybe you’ll get a refund of the temporary PA turnpike toll that was imposed to pay for the 1889 Johnstown flood
ask John Boehner, he trusts obama completely
I sometimes think the talk about taxing 401Ks is intentional rhetoric from “the powers that be” to scare people into pulling funds out of their 401...here’s why.
If you pull money out:
1. automatic 10 percent penalty
2. the money you pull out is taxed at the percentage of your tax rate for that year (but when you combine your regular income and the money taken from the 401K, your tax bracket has changed.
3. the money pulled raises your income, probably raising your tax bracket, and the money you earned that year is also taxed at that higher bracket, meaning you probably didn’t pay enough in and will owe more to the IRS on your regular earnings.
In other words, if you pull money from your 401K, you’ll probably end up paying a much higher percentage to the government than if they tried to set an across the board percentage for confiscation.
Not that I’m for any tax on the 401K, but I often hear people say they’ll pull their money from their 401 rather than let the gov’t have it...well, the gov’t has it, either way the scenario rolls.
Those are the rules today only. What about tomorrow, next week, or next year? I still say the old accountant rule of thumb to always defer taxes immediately is the best strategy. Accountants know better than anyone that what is taxable and what isn't taxable changes with the seasons.
I dont understand the idea at the link,
income into 401Ks and pensions are not tax free like say mortgage deductions are, they are tax deferred. You pay a % tax on whatever is there when you get it to spend after 65
The only reason why reporting initial contributions would help the Feds is if the value went down before retirement to force you to pay taxes on money you lost.
You may be right. I think it’s dangerous these days to do anything that is deliberately taxed advantaged, including any IRA. There’s no question in my mind that the government will begin means testing social security. That’s another backdoor tax on IRA’s.
For years, I have thought the same thing. The only defense we will have against that tactic is to insist that Social Security be called "welfare" if/when that happens. What keeps SS politically palatable to the taxpayers is the fact that if you worked, you paid. Once you retire, you got money back.
If the day comes that you are told that even though you worked and paid in, you can't get it back, then the entire concept of it being a retirement plan falls apart. It is just another form of food stamps.
If they only tax me at the 15% tax rate this article is talking about, I will have lots of money leftover.