Feds eye your 401k.

[theFallGuy]

It was only a matter of time before this came up.

Feds eye retirement-fund tax to cut $16 trillion-plus deficit - NYPOST.com

[possumslayer]

I should have never read this ,I'm gonna puke.....when are they gonna stop?
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[rockytop114]

no one better take my 401k

[Slydell]

Sorry, we can't have you people building up those retirement funds. We need that jack.

[theFallGuy]

can't have people taking care of themselves, we need to go on another $1,000,000 trip to Vegas on your dime

[Rasputin_Vol]

“Unlike the current system,” Gale told Congress, “workers’ and firms’ contributions to employer-based 401(k) accounts would no longer be excluded from income and would be subject to taxation, contributions to IRAs would no longer be tax-deductible and any contributions to a 401(k) plan would be treated as taxable income.”

In other words, the employee and employer would no longer get a deduction under the Gale plan, they would qualify for a credit. And the credit would “increase [government] revenues by about $458 billion,” Gale says.

If it is a dollar for dollar tax credit, it would nearly reduce my taxes next year to about $5000.

I would have to see more info on this, but I'm sure they are going to add some other form with a work sheet. And I'm sure that it will not be a dollar for dollar credit. In other words, for every dollar I contribute to my 401(k), they reduce my tax amount by that much.

And how will this play out with the alternative minimum?

[rockytop114]

postal

[Rasputin_Vol]

Ooops... right above that...

Another proposal being discussed in Congress says all tax deductions on 401(k)s and IRAs to be replaced with an 18 percent credit. The credit, according to a proposal that has been endorsed by economist William Gale, would be placed directly in a person’s retirement account.

How is this going to work? Can someone explain this better? Is this saying that 18% of what you contribute to your 401(k) will be the amount of your tax credit? And what is this crap at the end about "it" being placed in a person’s retirement account? What is "it"? Is it that same tax credit amount?

I'm confused.

[theFallGuy]

nothing the feds do is ever cut & dry

[rockytop114]

im scared to say what i think about this

[Rasputin_Vol]

I'll say this, if you want to really get us lazy Americans off the couch and in the streets, this is the exact recipe to do it. They've already got Social Security in peril of not being financially solvent in a few years. Now you have these guys brainstorming this idea.

[DEFENDTHISHOUSE]

I wonder if cutting the spending ever enters their "talks"
I am sickened to no end with our government.

[myrobbins7]

This has been going on overseas and I posted this kind of stuff a little over a year ago. I tried to inform everyone this was on the way to America. Im not shocked, when will people wake up to what's really going on?

[WA_Vol]

They are killing the incentive to use the 401k.

I know people now who dont invest in their 401k because they believe the tax rate they pay now will be lower then the tax rate they will pay in 20 or 30 years because of increased govt spending and the taxes that go along with it.

Now this? Why not take the tax hit now. Instead of waiting 25 30 years and finding out the nominal tax rate is 40% instead of the 30 odd % it is now.

[MG1968]

relax guys, this is only going to affect millionaires and billionaires. They're rich and can afford to pay a little more in taxes.

it's only fair...