Well... that would suck.

Guess I'm not feeling so bad for only putting in the minimum my company requires before they put in their full contribution.

This is such a large pool of money, country-wide, that I find it hard to believe the feds wouldn't come after it at some point.

This will go over like a lead balloon.

I try and keep a 50/50 Roth 401k and traditional 401k. Roth is not a terrible thing. Still tax deferral involved and may actually be better for folks overall.

Never trust the government. Think your Roth won't be taxed? I've got some land in Florida...

What a bunch of meddling cocksuckers.

And you can be guaranteed that in 30 years they will decide to tax it on the back end, again.

Where i am cant see the video, can someone give me a short and sweet?

The Gov't has been eyeing private IRA/401k accounts for years. Certain politicians have been conniving to get their hands on a piece of the pie.

They have been out of $$$ for a good while.
Like the one guy said, 'what can't go on forever, won't go on forever'. That's in reference to borrowing and deficit spending.

I prefer Roth. Get it over with and the growth is tax free (until they change that TOO!). After I reap whatever match there is in my 401k (403b for me), I max my Roth before putting another penny into the traditional pre-tax savings plans.

quote:

Originally posted by sjp:
Where i am cant see the video, can someone give me a short and sweet?

First, my guess -- BS Proposal that will go nowhere --
* No change to savings invested, but eliminating the pre-tax option and making all IRAs post tax (presumably with growth that is tax free) like a Roth.

Sounds like they want the tax money now, by moving people from 401K toward Roth IRA.

At this point I didn't hear mention of changes to the taxation portion. Did I miss something?

I NEVER recommend a Roth IRA to my tax clients, only a traditional up to its maximum.
1) I have seen the IRA law change 3 times since its inception
2) A bird in the hand is worth two in the bush
3) When 1099R's are issued for premature withdrawals, "taxable amount is not determined" is usually marked. The institutions are not required to compute or keep track of the taxable amount, & the Roth IRA holder usually has no records of taxed contributions. Therefore on Self-Prepared or "cheapo" tax prepared returns the taxpayer usually pays taxes a 2nd time.

Also many taxpayers never convert a 401K correctly to a traditional IRA when they leave a job & end up paying taxes anyhow.

NEVER trust a 1099R to be correct!

quote:

At this point I didn't hear mention of changes to the taxation portion. Did I miss something?

401K contributions & growth are not subject to FIT until retirement (only SS & Medicare taxes on contributions). The company contributions are deductable as expenses by the employer. The government wants their money NOW!
Roth IRA contributions are taxed at time of contribution, but any growth in value is not. (a decrease in value does not result in less taxable income, another reason to fund traditional IRA's)

Ant and the grasshopper, with the gummint being the grasshopper. The Progs are slowly beating the drum that it's not [bleatingsheep] f-a-a-a-a-a-i-r [/bleatingsheep] that some people retire to a life of leisure while others have to scrape by on the meager proceeds of Social (In)Security. But that willfully ignores two things. First, SS is going bankrupt because it's been so vastly expanded since its inception with the end goal of buying votes. So now it's paying for a load of 'benefits' for which it was never intended.
Second, a lot of people who have no retirement savings are in that situation because they either spent their working age life being coddled by the gummint, or they simply spent it on lavish lifestyles (new car every year, grand vacations, boats, RV's, etc.). Those of us who went to work and skipped the lavish lifestyles (I drive a 10+ year old car) and lived within our means are the ones who have money in Roths and 401(k)'s.

I know the pols in DC are eyeing that pile of cash looking to raid it. They're just waiting until they can get the political cover to do so. They'll likely claim they'll pull all that money into the Social (In)Security "trust fund" (sic) and everyone (except retired gummint employees and polly-tic-ians of course) will get a uniform universal retirement income.

It likely won't take them long to build up public sentiment to take the money. Heck, the "Free Shit Army" is roughly half the population. Add in those whose livelihood involves being part of the distribution of said free shit, and you have almost a majority. And those of us who work and save are in the minority. I constantly hear on a local financial show that the number of people who have more than $1,000 in savings is just a tiny percentage. So the Progs will claim there is a 'crisis' (like Bammy did with a sop to insurance companies health care. There was no 'crisis' other than that created by gummint fiscal mismanagement.

I don't really see the problem. I've been maxing my Roth and not contributing to the 401k because I don't want the tax deferral. I likely will be in a higher bracket once I start taking money out.

There are several issues wrapped in one.

1) apparently some the geniuses behind 'tax reform' have decided that the same amount of blood needs to be sucked out of the taxpayer the 'reform' has to be 'revenue neutral' in and of itself to make it easier for them to pass the legislation.

2) given #1, mathematically for every reduction there needs to be a fucking tax hike enhanced revenue elsewhere.

3) given #2, they are looking to raise taxes to find that enhanced revenue from politically feasible sources.

4) given #3, they are desperate to hide the impact of this tax hike and keep their jobs looking at areas of opportunity that would generate the least upset electorate.

So the idea under discussion is to remove or reduce the tax deduction for contributing to 401(k) accounts. In fairness, they would then change the tax treatment of withdrawals from those no-longer-fully-deductible 401(k) plans to be like Roth IRAs.

The problems are

1) loss of the immediate tax deductibility of 401(k) contributions would reduce participation. So, fewer people contributing less money into their own retirement plans. More dependence on Soc.Sec, more dollars sloshing into DC and not into investments.

2) 'revenue neutral' tax reform means no pressure to reduce spending in DC. Tell me again, exactly why did we vote out Democrats?

3) This tax hike hits only one segment: those productively working and saving for their own retirement. Could there be a segment less worth kicking in the nuts targeting for enhanced revenue?

If we assume for the sake of argument that we're stuck paying income taxes, I'd almost rather be taxed more now (when I have a greater income) than have to pay a percentage of my lower, relatively fixed income after I retire.

quote:

Originally posted by hile:
If we assume for the sake of argument that we're stuck paying income taxes, I'd almost rather be taxed more now (when I have a greater income) than have to pay a percentage of my lower, relatively fixed income after I retire.

Are you assuming that you'll be in the same tax bracket in retirement that you now currently occupy? For most folks, retirement drops them down a bracket (or two) so they pay less taxes in those years.

This message has been edited. Last edited by: marksman41,

We already spent those retirement funds- Who do you think we owe that $20 Trillion too?