Joe Biden promises to end traditional retirement account structure / tax

[Cotton1]

https://www-forbes-com.cdn.ampprojec...d-her-voice%2F m

One of the items in that document and on the Biden campaign website is a promise to “equalize the network of retirement saving tax breaks” — a proposal that generally translates to eliminating the tax advantages currently enjoyed by retirement savings accounts and replacing them with a “credit” or “match.” The idea is that the tax advantages, or “tax


More at link

[stjames1_53]

https://www-forbes-com.cdn.ampprojec...d-her-voice%2F m

One of the items in that document and on the Biden campaign website is a promise to “equalize the network of retirement saving tax breaks” — a proposal that generally translates to eliminating the tax advantages currently enjoyed by retirement savings accounts and replacing them with a “credit” or “match.” The idea is that the tax advantages, or “tax


More at link

Ahhh, the democrat heavy hand of taxation.... Dems will always find a way to steal from the working class.....

[Cotton1]

Ahhh, the democrat heavy hand of taxation.... Dems will always find a way to steal from the working class.....

It's also dog whistle class warfare

[Lummy]

Strong suggestion here that Biden is actually several wonks in a hotel bedroom.

He is the poster child for one term limits.

[MMC]

But there’s a final issue that’s even more concerning: this proposal doesn’t appear to recognize what really happens with retirement savings accounts tax advantages.



Here’s another example of such a proposal, a 2011 Brookings report:



“There is a formal economic equivalence between the incentives created by a deduction at a given rate and those created by a tax credit of a different rate. For example, a 30 percent matching credit is the equivalent of an income tax deduction for someone with a 23 percent tax rate. For every $100 contributed to a retirement account by an individual with a 23 percent tax rate, the individual would receive a tax deduction worth $23.”



These proposals appear to forget that tax advantages in retirement savings accounts are not simply a matter of deductibility, as one deducts mortgage interest or charitable deduction.



Instead, recall that in a Roth account, whether a 401(k) or an IRA, one pays taxes right away, then takes one’s money at retirement without paying further taxes.



In a traditional 401(k), one doesn’t pay taxes when making the contribution, but nonetheless must pay taxes upon withdrawing the money at retirement. This is the entire reason for the RMDs, required minimum distributions, to give the government its share without excessive delay.


What’s the benefit of the tax advantage, then? It prevents workers from being double-taxed, that is, taxed on their investment return.



And, finally, here’s a comment by Biden adviser Ben Harris, made at a Democratic National Convention roundtable and cited by Roll Call:


“If I’m in the zero percent tax bracket, and I’m paying payroll taxes, not income taxes, I don’t get any real benefit from putting a dollar in the 401(k).” Harris isn’t wrong here — and, indeed, however much Mitt Romney was excoriated for saying that 47% of Americans don’t pay taxes, he was right. .....snip~


Joe is looking for a way to double tax those with the 401Ks. Quite the deviate isnt he?

[Felid_Fem]

https://www-forbes-com.cdn.ampprojec...d-her-voice%2F m

One of the items in that document and on the Biden campaign website is a promise to “equalize the network of retirement saving tax breaks” — a proposal that generally translates to eliminating the tax advantages currently enjoyed by retirement savings accounts and replacing them with a “credit” or “match.” The idea is that the tax advantages, or “tax


More at link

The radical left Democrats don't want anyone to have a "savings account". They want everyone utterly dependent upon them, their only "god", called Government. That's the bad news. The worse news is.... under a Biden leftist Democrat presidency.....

nobody will have a job enabling them to have a 401k account. Only government workers will have jobs and get paid (whether they're at work or not)....kind of like now, only on steroids.

[TheOneOnly2]

Pensioners/retired baby boomers are basically the most important demographic in Australian politics because there are so many of them. The lefts attack on 'franking credit's' was one of the main issues in our last federal election. It surprises me that this group is not mentioned more in US elections. All focus seems to be on minorities. We never really hear who is winning the Lebanese vote or who is doing best with the Asians here in Australia.

[Cotton1]

But there’s a final issue that’s even more concerning: this proposal doesn’t appear to recognize what really happens with retirement savings accounts tax advantages.



Here’s another example of such a proposal, a 2011 Brookings report:



“There is a formal economic equivalence between the incentives created by a deduction at a given rate and those created by a tax credit of a different rate. For example, a 30 percent matching credit is the equivalent of an income tax deduction for someone with a 23 percent tax rate. For every $100 contributed to a retirement account by an individual with a 23 percent tax rate, the individual would receive a tax deduction worth $23.”



These proposals appear to forget that tax advantages in retirement savings accounts are not simply a matter of deductibility, as one deducts mortgage interest or charitable deduction.



Instead, recall that in a Roth account, whether a 401(k) or an IRA, one pays taxes right away, then takes one’s money at retirement without paying further taxes.



In a traditional 401(k), one doesn’t pay taxes when making the contribution, but nonetheless must pay taxes upon withdrawing the money at retirement. This is the entire reason for the RMDs, required minimum distributions, to give the government its share without excessive delay.


What’s the benefit of the tax advantage, then? It prevents workers from being double-taxed, that is, taxed on their investment return.



And, finally, here’s a comment by Biden adviser Ben Harris, made at a Democratic National Convention roundtable and cited by Roll Call:


“If I’m in the zero percent tax bracket, and I’m paying payroll taxes, not income taxes, I don’t get any real benefit from putting a dollar in the 401(k).” Harris isn’t wrong here — and, indeed, however much Mitt Romney was excoriated for saying that 47% of Americans don’t pay taxes, he was right. .....snip~


Joe is looking for a way to double tax those with the 401Ks. Quite the deviate isnt he?

There's another problem too. Since your tax defereds are deducted from your gross taxable the difference earns. If your a say 30 then your contribution x.30 earns too. The taxable event is down the road hopefully when youre dead or drooling down your bib and don't give a $#@! either way

[Cotton1]

The radical left Democrats don't want anyone to have a "savings account". They want everyone utterly dependent upon them, their only "god", called Government. That's the bad news. The worse news is.... under a Biden leftist Democrat presidency.....

nobody will have a job enabling them to have a 401k account. Only government workers will have jobs and get paid (whether they're at work or not)....kind of like now, only on steroids.

Exactly .."401 be white folk stuff dawg"