“controlled 401K rollover to Roth IRA would work for people”
You can do that now.
In fact, if you quit or change jobs you can roll all of it to a self-directed IRA without paying any taxes or penalties.
I thought rolling a “quit job” 401K (pre tax) to a Roth meant paying income taxes on it now. I’m not an expert on these things :-) ... I just know enough to save like I should :-).
What I’m suggesting is a low, fixed tax penalty to roll money in an existing 401K (or similar retirement plan) into a new vehicle that is taxed at a flat rate as money from the 401K goes in, but matures like a Roth with no dependence on current employer.
I think what the swamp things are looking for is cash now to cover their tax cuts. Anyone with a brain cell knows that there MUST be spending cuts, but we are dealing with idiots that are focused on the “now”. Let’s use that to our advantage.
What I’m proposing is that they can “tax” 401K money now, but the taxed amount is immediately placed into a Roth-like fund that matures tax free. So, assuming I live to retire (not sure about that as liberals certainly screw up my vitals :-)), I can withdraw that pre-taxed money tax free.
Let’s say we’re given an option to do this “rollover” on, I don’t know, up to $30K this year and the tax on this cash is 15% ... $4.5K goes to Uncle Sam immediately. The remaining $25.5K goes to my new Roth-like IRA.
If there’s $5T in retirement plans like 401Ks IIRC ... that means there is $750B in cash they could get “early” (obviously, you don’t want all of this tapped across one year since they’re spend crazy idiots).
They’ll be able to claim their tax cuts are paid for, and we get a discount on taxes on cash we earned. The younger people are, the better it will be for them in the long run. Older people get a small break on taxes on their 401Ks ... everyone wins (SO LONG AS SPENDING CUTS COME ONCE SOME SANITY IS RESTORED IN CONGRESS!!!!).
Also, I’m open to any proposed flat tax percentage so long as the number is less than 15% :-).
Thanks. Yes, you can rollover without penalty. You can’t convert without getting taxed.