Posted on 06/01/2021 6:02:13 AM PDT by DCBryan1
Why does the government think taxpayers are smart enough to understand the tax code, but too stupid to get a voter ID card?
step 1: give them a tax credit
step 2: seize their accounts and dribble it back a fraction of it to them using the social security administration
‘Millennials (41%) are the least likely to have access to an employer-sponsored retirement plan, but over a third (35%) of Gen Xers and 30% of baby boomers are unable to take advantage of the tax benefits of a 401(k) plan.’
My friends we’re asleep at the switch. We can only counter by insisting millennials drop out of SSI. The charges of robbery by old folks can be countered by eliminating taxes on SSI income. Put it in Trump’s next contract.
This plan is NOT about taxing 401k money (I’m not saying that won’t happen, just that this isn’t doing so). Currently money contributed to a 401k is not taxed — a full deduction is allowed for such contributions. Under Biden’s plan, there is no more deduction, but you receive a 26% tax credit on contributions.
This would benefit anyone whose marginal tax rate is lower than 26%. A deduction is mathematically equivalent to no deduction plus a credit equal to your marginal tax rate. If you.pay 26%, you break even. Essentially it amounts to paying people to fund their 401k. (For most people, since most don’t pay 26% taxes). Obviously those who earn enough to pay over 26% taxes would foot the bill.
Probably it will be popular since it benefits more people than it harms, but it certainly is a tax increase on higher income Americans. I would personally benefit, but a tax increase is never a good idea.
Then you can expect the dems to look at taxing gains each year (as ordinary income) then maybe tax them again when you take distributions.
I am of the opinion that tax credits are easier to tinker with and ultimately easier to do away with altogether. Looks to me like a half step on the way to elimination.
Stemba-U R smart. I had a retirement(lump sum), a 401k(big employer) and SSI. Not fair to the poorer chumps out there. Is Biden’s plan really in the interest of the millennials? No mention of Roth IRA’s, something the rats can’t handle. Get them out of SSI-rat’s won’t allow it. With this plan the rats are getting the jump on us. We have to be smarter, an uneasy task.
While this is good, my take on it, is that it is just for fees, etc. that were owed to the university. Not likely to be for actual student loan debt, the way I read it.
Yes
I’d advise not even having a 401K....but I know I’m just me..and don’t like other people “managing” my money for a fee.
The government would love to nationalize all retirement accounts - and give you a “monthly guaranteed retirement income” that will be pennies on the dollar as to what you receive now.
This is what has been proposed.
So what is a “higher” earner in the opinion of Biden, $25000 and up?
I am no financial expert at all, but I decided several years back to invest in the Roth 401K. I simply pay my taxes on the front end.
Of course, no one is safe while the legislature is in session.
It’s always done this way. The majority benefits under the initial proposal so they don’t object. (”F’ those rich people, I’m making out!”)
Later the numbers will be changed, so those willing to rob the “rich folks” end up getting robbed too. And in the end, it will end up hurting those all too willing to screw others even more.
File it under: another tax on the “stupid and greedy”.
Personally I detest the 401k plan in concept. The tax advantage of contributing before taxes leaves rose taxes to be paid at withdrawal. The penalty incurred for early withdrawals and so on.
Graham-Rudman created this huge pool of money and the democRATS are. Salivating over how to get their hands on it.
One should save for retirement and not need some leveraged account with many strings attached. This also puts the fund managers in charge of the board of directors as the largest shareholder in many companies.
This is how wokeness spreads
“Dems have been looking for many ways to infiltrate retirement savings.” This is it exactly. I forget how many billions of dollars conscientious savers have salted away in their various retirement accounts; by now it might be over a trillion. The pols — with their pitiful, poorly-run Social Security system — have been slavering over this pot o’ gold for several decades. One of these days they’ll make a move and the confiscation will have begun.
So, that $500k is in Zimbabwean money?
I am the exception to the upper income rule. I don’t utilize 401k, IRA or Roth.
I have felt that money the government earmarks as retirement savings is at risk. I would rather have it in my pool of “normal” money.
The Roth is exponentially worse IMO. You pay taxes going in, and trust the govt to keep the rules constant so you don’t pay going out. Crazy. On top of that, my highest tax rate level should be now, not while retired. So the math of paying in, but not out makes no sense.
I don’t trust them to leave the rules constant long enough for me to retire. F them.
They won’t f us all...
There will be less for working people of all races...
And lots MOREfor their pets at the bottom - more for illegals, more for blacks on ‘disability’ and ‘programs’, more for criminals... Less for everyone else.
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