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GOP Wanted You To Pay More Taxes on Your Retirement Savings, But Then The Resistance Spoke Up
Last week, Republicans proposed to cap the amount that Americans can contribute before taxes to 401(k) plans and individual retirement accounts. The details of this proposal came to light publicly and was reported by nearly all media sources. It was intended to increase the tax burden on middle class Americans to offset the cost of tax cuts to the wealthiest. Fortunately The Resistance heard this, spoke up, and exhibited Smart Dissent. Thus, this specific proposal did not make it into the House GOP tax plan. Numerous other things did which we will cover in a new post next week.
House Republicans are considering a plan to sharply reduce the amount of income American workers can save in tax-deferred retirement accounts as part of a broad effort to rewrite the tax code... Such a move would prompt a vocal backlash from middle-class workers who save heavily in such retirement accounts.
Workers may currently put up to $18,000 a year in 401(k) accounts without paying taxes upfront on that money; that figure rises to $24,000 for workers over 50. The proposals under discussion would potentially cap the annual amount workers can set aside to as low as $2,400 for 401(k) accounts
On the Senate floor on Thursday, Senator Gary Peters, Democrat of Michigan, warned that the Republican majority was “keeping open the possibility of raising taxes on Americans who are trying to save for their retirement.” ICI, Financial Services Roundtable, the AARP and other groups have formed a coalition called Save Our Savings in order to fight to protect retirement savings in the tax-reform debate.
Sources:
https://www.nytimes.com/2017/10/20/us/politics/republicans-tax-401-k.html
http://thehill.com/policy/finance/356489-financial-industry-worried-gop-tax-plan-will-change-401ks