and redistributing it to Holders People and other Obama voters
Posted on 02/21/2014 10:56:56 AM PST by reaganaut1
President Barack Obama plans to ask Congress in early March, as part of his fiscal 2015 budget, to reduce some of the tax advantages for employer-sponsored retirement plans for higher-income earners, according to published reports.
Plus, the president wants to limit the value of all tax deductions, defined contribution exclusions and IRA deductions to 28% of income — and include an overall cap on all retirement accounts, including pensions, that could bring in $1 billion a year in new tax revenue, according to a Pensions & Investments report.
According to the report, the proposals are designed to direct more of the tax preference for retirement savings toward getting more low- and middle-income people into the habit of saving.
Based on current tax brackets, Pensions & Investments reported that the 28% limit would reduce the tax advantages of retirement savings for people earning more than $183,000 or couples earning more than $225,000. And the overall cap for all tax-preferred retirement accounts would limit them to providing an annual retirement income of $205,000, which would currently cap tax-preferred accounts at $3.4 million, but could go lower as interest rates rise.
So, who might feel the effects of this proposal? Largely, the top 5% of tax payers. According to the Tax Policy Center, a partnership between the Urban Institute and Brookings Institution, there are about 6.07 million Americans who earned above $200,000 in 2011 and they make up the top 4.2% of taxpayers, according to published reports. Read more about the president’s tax proposal here: Who makes more than $250k, and are they rich?
And what do experts have to say about what the president might propose? In the main, they say the rich need not worry that their tax breaks for saving for retirement will be cut.
(Excerpt) Read more at marketwatch.com ...
The question most people ask themselves this day is not, how hard do i have to work to be successful?
Instead it is: How poor do I need to become to avoid the wrath of the federal government?
Punish those who scrimped and saved their whole lives so that they wouldn’t have to have dog food for supper when they reach 65, so those who lived like dogs can have ‘their fair share’......................
As it will be in the future, it was at the birth of Man-—
There are only four things certain since Social Progress began:-—
That the Dog returns to his Vomit and the Sow returns to her mire,
And the burnt Fool’s bandaged finger goes wabbling back to the Fire;
And that after this is accomplished, and the brave new world begins
When all men are paid for existing and no man must pay for his sins,
As surely as Water will wet us, as surely as Fire will burn,
The Gods of the Copybook Headings with terror and slaughter return!
Punishing people who are responsible- the leftwing way
“I wonder if this would affect Roth IRAs, which are pre-taxed. It must really irritate the feds that they can’t get any more money when those IRAs are cashed in.”
They already changed that to tax the earnings on your Roth IRA.
“They already changed that to tax the earnings on your Roth IRA.”
What? I completely missed that one. Can you post a source for those of us that can’t keep up with all of the evil this administration is perpetrating on the citizenry?
Public “servants” and unionistas to be exempt of course.
FUBO!! We worked hard and saved for our retirement — and were taxed along the way — federal, state, local, real estate, and on and on. Now, you are going to take our hard-earned money away through MORE taxes!! Again I say — FUBO!!
That is what my financial advisor at Edward Jones said.
I wanted to convert a regular untaxed IRA to a Roth IRA in amounts that would be un-taxable each year. Just draw to the limit that wouldn’t be taxed and stuff it back into a Roth.
She laughed and said they got wise to that trick and you couldn’t do it anymore.
Well, because .gov built the small businesses, not the small business owner, .gov is entitled to siphon off any and all profits and transfer the cash to cronies and to buy votes. After all, that is what the USA is all about these days, isn't it?
“Now couples earning more than $225K are the “rich” to be punished. Lots of blue states like NY and CA have residents earning this much who don’t consider themselves rich.”
We have a couple of younger male relatives in California, and they decided after Obozo’s conversations with Joe the Plumber, to never make more about $200k per year. As you noted, that “ain’t a lot of green in Californicator land with our income/sales tax and property taxes.
In stead of raises or promotions with raises, they negotiate for more time off, better company vehicles, flying business or first class instead of cattle car class. Luxury hotels, not a Holiday Express, when they travel.
Their wives get job offers over a $100k per year on a regular basis, and they work very few hours as DBA consultants, and never make very much taxable income. That way they can keep up their skills and contacts.
Private schools out here cost anywhere from 12 K to 20 K per year, and that is just the beginning. Those are after tax $’s.
They have a female cousin in their age group, who stays overseas with her talented contractor husband. They left during the Clintoon years after they put in their marriage penalties re taxes. They may never return.
The point is not to raise revenue, the point it to punish the rich.
But at least congress, the president and higher level federal workers will be exempt.
This type of risk is usually associated with Banana Republics...
How exactly does taking away your tax advantage make me learn to save more?
Funny thing…
My money guy was pushing the ROTH back when it first came out, and I laughed at him and said they will end up taxing it twice, front and back, just wait.
I thought the same way, and every time I hear serious proposals for a VAT or even a federal sales tax, I think that would surely capture a lot of money from Roth IRAs.
I funded my 401(k), converted to an IRA when I retired, and have done OK. Instead of a Roth, I bought rental real estate. A lot of tax advantages, and there is real diversification from Wall Street types of investment. Plus, I could add sweat equity which is not taxed. An often-overlooked method of increasing my investment without ever having to produce declarable income.
OTOH, I can see where a Roth might have some advantages.
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