Feds eye retirement-fund tax to cut $16 trillion-plus deficit By GREGORY BRESIGER Last Updated: 8:25 AM, April 22, 2012 Posted: 11:16 PM, April 21, 2012
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. A commission looking for ways to close the deficit, and, noting the extent of 401(k) tax breaks, recommends an examination of the system as one way to prevent government bankruptcy.
Besides 401(k)s, other possibilities include the mortgage-interest deduction on second homes, as well as benefits from employer-provided health insurance, which are untaxed now. Under current 401(k) rules, total employee/employer contributions can’t exceed $50,000. In the proposed rule change, employer/employee contributions would be limited to 20 percent of the employee’s compensation, with a maximum of $20,000, the so-called 20/20 proposal. 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. “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.”....................>>>>.....................>>>>.....................Read more: http://www.nypost.com/p/news/business/plunder_CrD9s6MElVsEIJj2IVgHuK#ixzz1srQG6WQn
Folks are already buzzing about this 401k scheme and are ready to pull their money out. They don't even if they have to pay a penalty......they are going to pull it out!!
As far as eliminated the mortgage tax deduction......OMG.......that's a sure way to grown the home sales market!!!! NOT!!!
If the government continues to squeeze the working class........they will have a revolt on their hands. imho
When the INSANE are running the ASYLUM In individuals, insanity is rare; but in groups, parties, nations and epochs, it is the rule. -- Friedrich Nietzsche
“How fortunate for those in power that people never think.” Adolph Hitler
dont put money in ANYTHING.....why should we bother to invest....lame a$$ leadership....Buffet and buddies can kiss my a$$....as well as those who think we don't 'donate' enough to those with some other 'need' that I don't have...
GET OFF MY BACK YOU DEAD ANIMAL
...you are a product of your environment, your environment is a product of your priorities, your priorities are a product of you......
The replacement of morality and conscience with law produces a deadly paradox.
STOP BEING GOOD DEMOCRATS---STOP BEING GOOD REPUBLICANS--START BEING GOOD AMERICANS
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