Keep in mind, though, that this kind of sh!t is exactly why I was telling anyone who would listen that it was a bad idea to do Roth IRA conversions back in the 1990s when the Roth IRAs first came into existence. Anyone who did that had to pay taxes on the conversion from a traditional IRA to a Roth IRA in exchange for future tax exemption for withdrawals from the Roth IRA. I thought it was a bad idea because there was no way for anyone to know how the tax code might change between the time you made the conversion and the time you withdrew the money.
I agree with both of your posts. The tax deferred limit seems to be the object of this idea.I really don’t think retirement investment plans will be seized outright. I can see how they may ALL loose tax deferred status at some point in time. I also had the same feelings about the Roth IRA conversions. It seemed hazardous.
This may never see the light of day in Congress, as you say. But the fact that The Won posed his argument by posturing about how much money a person needs for retirement is ridiculous. It was an arrogant and stupid statement (one of many) probably made to appeal to his base that may or may not have any retirement funds. But to any one who has any money in an IRA/401K...the alarm bells go off.
“On the other hand, I don’t think proposal is going to go anywhere. The U.S. investment banking industry is probably gearing up its lobbying machine to quash it before it ever sees the light of day in Congress.’
Most Americans have no where near $3 million in IRA’s and 401K’s. To the average American a $3 million cap is going to seem extremely reasonable. When it fails to even get a vote in Congress, Obama and the press will portray its failure as one more example of mean spirited Republicans protecting the wealthy. This is all part of the PR campaign to spend and tax more.