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Posted on 04/22/2012 4:44:53 AM PDT by jimbo123
Uncle Sam, in a desperate attempt to fix its $16 trillion-plus deficit, is leering over Americans’ retirement nest egg as its new bailout fund.
Capitol Hill politicians are assessing tax changes that could let the Internal Revenue Service lay claim to a portion of the $18 trillion sitting in 401(k) accounts and other tax breaks used by middle-class workers, including cutting the mortgage tax deduction.
(Excerpt) Read more at nypost.com ...
I am 59.5 on Jan 11th 2013, I am SOL.
I meant to write “Dems control the Senate”. Congress COULD reign in this expansion of power, but with a split house ans senate it’s not happening. This stuff is very scary and few are paying attention. Just wait until a bunch of 401(k) plans are found to be “non-compliant”.
“Just wait until a bunch of 401(k) plans are found to be “non-compliant”.”
They are - everyday. The EBSA auditors will cite plans for being in violation of various provisions of ERISA. If they can cite for a prohibited transaction - usually a Mickey Mouse error - they impose ERISA section 502(l) penalties which are 20% of the amount involved and automatically go up to 100% of the amount involved if not paid within 100 days.
“I no longer am involved with I.R.A.s and 401Ks but my wife is and will be 59 1/2 on June 27th, this year. We are considering removing all of it and taking the tax hit (but no penalty) at that time. The “Bush tax cuts” expire at the end of this year and that’s going to be devastating to us so called “rich people”............”
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Think about that clearly before you do that. That would just be playing into their hands giving them immediate taxes. If you end up deciding to do pull your money from your IRAs & 401Ks and pay the taxes now, you might be better off long-term by transferring those funds to a ROTH IRA (at least FUTURE withdrawals from the Roth would be tax free). But, again, that is something you should study thoroughly before doing.
The American people have no one to blame but themselves. Especially the 50+ year olds. Our deficits were growing and no one wanted their entitlements gored. The Black Swan event that destroyed the US was 9/11 which set into motion the bankrupt wars that followed and the Fed Reserve tradition of bailing out Wall Street every time one of their schemes imploded. 2008 was the mother of all implosions with a huge derivative minefield still ready to explode if EU falls apart. Bankers basically told the Fed Gov that due to their failure to monitor Wall Street activity, larger and larger schemes were sold to the US and world system that if the US gov does not spend trillions in bailout and assume the toxic assets, the US financial system/economy will implode. Instead of taking the medicine of one severe reset and depression, the Fed Reserve and gov chose to bailout and QE till our debt is a threat to US power and survival. Congress has no choice but scavenge America for savings and assets to tax to close this desperate deficit or the US face collapse. The only way out for the US is taxes, austerity and inflating our debt away. If the middle class does not make proper preparations they will see any savings taxed and inflated by higher prices.
Study Brazil. After WW2 she had a growing middle class until she over borrowed in the 1960’s. It was thru taxes and money printing (inflation) that allowed her to eliminate her international debts. Today relatively debt free and resources rich Brazil is emerging again. The price of her ordeal, the absolute destruction of her middle class. The US middle class is facing the same fate.
I have taught my children to follow my example and stay away from government “sponsored” retirements such as IRA’s and 401K plans. Just invest the money (after taxes) themselves...you cannot trust the government to not steal this money down the road, they have no morals and no ethics. Stay independent! That means (for you anti-Romney “conservatives”) stay away from the government as much as you possibly can.
Didn’t the Argentine government confiscate many pension plans when they got into serious economic trouble?
Pass a constitutional Amendment that requires all Government agencies to rejustfy their existence every 15 years. If any agency fails to met its established, by law, goals in 15 years they are automatically closed., their real property is sold, and all employees forced to find new jobs.
The problem that has finally hit us squarely between the eyes isn't the lack of taxes it is overspending at multiple levels by the Federal Government.
Lets start with my two “favorite” agencies - the Department of Energy and the Department of Education.
Department of Energy was established in the late 1970s and was supposed to reduce our dependency on foreign oil. Forty years later what have they accomplished other than increasing the amount of taxes required to “run” the Federal Government?
Department of Education was established about the same time and was supposed to improve our children's test scores, etc. Forty years later what have they accomplished other than increasing the amount of taxes required to “run” the Federal Government?
Does any freeper have other Departments that have failed so badly over the last 40 plus years?
As a private citizen I try to avoid throwing good money after bad for more than a year or two. But our “elected” “professional” politicians see no problem doing that with our tax dollars. Every wonder why?
The numbers will drastically incresae after July 1.
That’s you
This is me
Losing the mortgage interest deduction will raise our taxes by almost $6000 a year, and where is that supposed to come out of? What we are desperately trying to save for retirement?
I’m sure we are fairly typical of many who are squarely in the middle class
I stopped completely saving in my 401 after bamey was elected....why even do it?....I do believe that ultimately they’ll tax or index it.....instead, working on just paying bills...mostly the house....
They do that, and it’s Civil War II. I’m serious.
Several things are going on with this proposal.
First, the change would be a direct betrayal of the implied promise to millions of people who have been saving for retirement. The “tax break,” remember, is a reward or incentive for doing what the government wanted: saving for your own retirement. To change the rules for current savers would be a double-cross, a betrayal, a swindle, and a form of banditry. In private life, this would land you in jail for fraud.
The reason for allowing people a tax break on retirement investments was to allow before-tax growth of the savings. THEN the government taxes you at the end, when you take out the money as an elderly retiree. Note that if you are a poor retiree, you are in a lower bracket and don’t pay as much taxes as someone in a higher bracket. Note also that the government presumably profits in the end, because they participate in the successful result of your saving. They are taxing you, but at least they are doing it in a way which causes less harm that usual.
But now note that under the new plans, they will tax you first, before your savings have even grown. This gives you less seed for growth, and also gets the government less share in the results, because the ultimate harvest of your savings will be less.
Why would they do this? For the same reason that any drunken wastrel would rather spend today, and forget about tomorrow. Our increasingly profligate government has abandoned the prospective view: that is, they close their eyes to the future.
It is characteristic of the best in human nature to think beyond the narrow present: to learn from the Past, and to look toward the Future. Thrift is merely one tangible way of expressing this view; and looking toward an afterlife is a more sublime aspect of the same time-transcendant view of human existence.
The infant has neither. He cries for his wants, and then sleeps, only to awaken and cry again. One cannot expect a nation to survive, whose people have been conditioned to keep their development arrested at the infantile stage.
Dependence does not rule: it gets ruled.
So let's dirty up some other country, not our own. Yeah, that's the answer.
Look, it costs money to buy the votes of the corrupt and lazy... are you begrudging that? /s
So, tell us - have you stopped driving gasoline-powered vehicles?
That is why they are nationalizing the Nation’s oil business. They want to get some profits for their trouble.
The history of socialism is rife with good intentions leading to consistently bad results.
Let’s not let the globalists play us for third world idiots for a change, huh?
From your posts, it seems you'd rather get played for a socialist idiot.
If we have no guarentee of any benefit of drilling, then don’t drill here. It is as simple as that. It is a business caculation. Don’t host a risky operation in a bunch of people’s lives with no financial benefit and insurance to them for the inconvience and risk you cause.
My house goes down in value and people’s livlihood is wrecked for what in exchange? My taxes go up for loss of business. Good people’s families and wealth are wrecked. What do we get for this risk? A few jobs they offered on the rig (some of whom they murdered to save a buck in operations)? That didn’t help offset what they did to my life and the life of others who live and work here.
BP is stomping around the globe happy and profitable as can be with a mess in it’s wake. They do this all the time to third worlders. I suggest we not let them have the same deal here. We are not stupid, dirtboy. The Gulf is not their property. They have public leases to screw us up for nothing in return.
Here is what it is like. Let’s put an oil dump in your back yard and see how you like the property and business losses, cancerous gases, odor and death. All the profit goes to the dumping company and no one gives a crap about you becaue all that matters is the profit for the dumping company. In fact if you complain about it, you are an anti-capitalist so shut up and eat it. You should count yourself lucky that the dump truck driver has a job.
Maybe if we can publically torture and execute all the executives in the oil company and their Federal overseers if they cause a spill, that would be the insurance we need. Right now, they are frolicking in their limos and shaking us down in DC after what they did here.
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