Skip to comments.Obama plan: Cut tax breaks for richest retirement savers
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 presidents 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 ...
And the chance of the GOP-majority House considering this legislation is.....
Another Obama income redistribution scheme.
Haven’t you heard that Obama doesn’t need Congress, he has a phone and a pen and can rule by executive orders.
Since Caliph Baraq has established the precedent of changing the Obamacare laws every week or so unchallenged by anyone, is it possible he will able to do this with the tax code also?
“$1 billion a year in new tax revenue” amounts to about 2.4 hours of federal government spending. Where are we going to get the revenue for the remaining 364 days, 19.6 hours?
This only affects small business owners and wage earners.
It has no effect on 0dunga or any of his rich buddies or any of the corrupt-to-the-core creeps who got rich by being elected to government.
What a flaming jerk.
Who is this putz to dare declare how much is "too much" and set a cap on what I might save for retirement?
They’re always wanting to punish the poor bassturd that was smart enough to make something of himself to get where he is and steal whatever he has.
I despise communists such as this turd on a stick.
May his days be few and a incurable pox be upon him.
Except for higher-income earners whose employer was the feral government, of course.
No legislation, executive order!
I’m not sure, but I don’t think there has been a budget passed since he won election in 2008, or is it just HIS budgets that haven’t passed?
Maybe we need a Ukranian solution to this problem.
Tell the SOB to give up his first along with Pelozi and Rip Off Reid.
While I agree he is a putz, he is not capping how much you can save for retirement. He is proposing capping how much you can save in a tax-advantaged account.
I've said all along...we are going to be the old Russia with the Party people getting to take vacations on the Black Sea and the workers fighting for food in near empty groceries....
Exactly. There's never any justification for proposed tax increases, never any goal, purpose, or limit; a tax increase is to generate more revenue for the government, and that should be enough reason in King Obama's eyes.
it still is a disincentive to work harder and earn more and save more....
Message: Don’t be responsible and save for your retirement. Be dependent on the government. I despise this regime.
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