Posted on 06/01/2021 6:02:13 AM PDT by DCBryan1
No he hasn't. BuckFiden is mentally incapable of proposing anything more complex than what flavor of pudding he should get today.
His HANDLERS proposed this. His HANDLERS propose everything BuckFiden is credited for. They even admit it. See here.
In democrat speak, a “tax credit” really means a transfer payment. In theory you only get a tax credit if you earn enough to owe taxes, thus you get a credit against the tax that would otherwise be due.
However, most democrat inspired tax credits, e.g. the earned income tax credit and the child care tax credit do not require that you paid any tax at all . . . the government still pays it out to the “deserving” people who otherwise would get no benefit from a retirement contribution.
This is a stealth way to increase tax on those who can pay, (as evidenced by their 401(k) contributions) and redistribute it by direct payment (called a “tax credit”) to those who earn no money and pay no tax.
On that I agree. But attempts to modify the Social Security program is not called the "third rail of politics" by politicians for nothing. It will be even more so with private retirement savings.
Since defined pension plans have gone the way of the dodo bird (unless you work in the public sector), 401(k) and IRAs are all the people have left to supplement the meager Social Security payments. And most of them don't put nearly as much into them as they should but that's a story for another thread.
Attempts to come after 401k's will be political suicide and the outrage of the people will be truly bi-partisan. Democrats invest in 401k's too.
So I think this will be a non-starter. But yes, if the politicians could get their grubby hands on our retirement savings, they would do so.
That is my hope as well.
Sounds like a totally discretionary tax to me. Going to get shafted with a high contribution tax rate? Simple, don't contribute. In other words, if the tax impact is about the same then screw contributing to a 401K with all the limitations and restrictions you get with one. Just take the money in salary (after tax) and invest as you wish.
Then who's footing the bill?
Good point, but those in higher brackets still would benefit from contributing to a 401k, just not as much as they do under the current tax law. Under current law, it’s a deduction, which means no tax paid on any contributions. Assume a 35% marginal rate and a $10,000 contribution for example. Under current law, the taxpayer saves $3,500 in taxes because of the $10,000 deduction. Under the new law, the same taxpayer would lose the deduction, increasing his tax bill by $3,500, but would receive a credit of 26% or $2,600. The final tax bill would be $900 higher than under current law. However, if he did as you suggested and invested in his own, his tax liability would still include the $3,500 tax owed on the $10,000 he invests, but there would be no tax credit. Therefore, he’d pay $3,500 more in taxes than current law allows, rather than $900 more if he invested in a 401k.
Unless there are other tax breaks or incentives he could take advantage of, it’s hard to see why even a high-income tax payer would pass up a 26% credit on his investment. I would think most would contribute the legal maximum to the 401K.
You folks are missing something. While the rats are thinking of ways to raid our accounts we can always fight for $100k withdrawals (tax-free) from the accounts. Jump start the economy. Why wait 10 years for the soon-to-be 75 year-old minimum withdrawal? It should be offered for those with a million already in their accounts. Call it a tax cut for the rich.
No amount of money we be enough for these criminals.
Did they cancel the debt for all or just certain woke tribes? i.e. minorities and freaks but not honkies....
One drawback of this plan is it will raise the MAGI for some of the democrat’s loyal followers who get benefits based on income. Obamacare would be one example. An early retiree receiving Obamacare subsidies may no longer be able to work part time because putting some of the money into a 401K/IRA to
to stay under income limits doesn’t work anymore. This could impact Vets receiving VA benefits based on income as well.
They already have tried. Jesse Jackson wanted 6 % of all 401 K’s to “Invest” in the inner cities. You know whose pockets it would have gone into.
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