Politics Thread

[bigdiggins]

Have you read the 401(K) plan? This seems to be, at best, a significant mis-characterization.

I'm not sure I'm a fan of it, but I believe it offers a 26% refundable tax credit on 401(K) contributions, so it's not really "making 401K contributions pre-tax". The federal income tax rate is 24% for HHLDs earning up to $321K, so they would get a net benefit. I have to think most Americans making under $320K per year, right?

Even for higher earners - If you make $400K per year your top marginal tax rate is 32%, so the spread there is 6%. If you are maxing out at $19,500 per year it's going to cost you 6% of that - $1170. I'm not going to say I don't care about $1200, but I wouldn't even notice it missing.

Here is a linke to a Marketwatch article the explains it

This plan would seem to benefit the vast majority of Americans while having a very minimal impact on high earners.

I am far from making $400k. So Biden's lie is going to impact me to redistribute wealth. But, as lefties all assume anything I have was given to me, couldn't be from hard work, and making the right choice, which wasn't always the easy choice. So, I should just be happy to pay more taxes and work hard for less, so it can go to others as you can rest assured they will find a way to ensure that anyone making $100k phases out of that credit anyway.

[boozehound]

I am far from making $400k. So Biden's lie is going to impact me to redistribute wealth. But, as lefties all assume anything I have was given to me, couldn't be from hard work, and making the right choice, which wasn't always the easy choice. So, I should just be happy to pay more taxes and work hard for less, so it can go to others as you can rest assured they will find a way to ensure that anyone making $100k phases out of that credit anyway.

I'm confused. Are you saying you make well over $400K per year? If so - good for you. If not, this plan would appear to benefit you.

If you make under $163K as an individual filer or $325K as a Married Joint Filer it looks like you would actually net positive from this change. Your highest marginal tax bracket is 24% but you would get a 26% refundable tax credit for your contribution. You would have to make north of $200K as an individual filer and probably close to $400K as a joint filer for this to result in you getting less tax benefit for your 401K contribution.

I don't really understand the rest of your post as to how it could possibly relate to the proposed tax code changes on retirement changes. It's also unclear if this is really a 'redistribution of wealth' of any kind. Unless you are clearing $400K per year (or $200K as an individual filer) no one is asking you to 'pay more taxes and work hard for less'.

[bigdiggins]

I'm confused. Are you saying you make well over $400K per year? If so - good for you. If not, this plan would appear to benefit you.

If you make under $163K as an individual filer or $325K as a Married Joint Filer it looks like you would actually net positive from this change. Your highest marginal tax bracket is 24% but you would get a 26% refundable tax credit for your contribution. You would have to make north of $200K as an individual filer and probably close to $400K as a joint filer for this to result in you getting less tax benefit for your 401K contribution.

I don't really understand the rest of your post as to how it could possibly relate to the proposed tax code changes on retirement changes. It's also unclear if this is really a 'redistribution of wealth' of any kind. Unless you are clearing $400K per year (or $200K as an individual filer) no one is asking you to 'pay more taxes and work hard for less'.

No, I'm saying I am far under $400k, and that Biden lied when saying his plan wouldn't raise my taxes. By taxing the 401k contributions of those in the $100k range, and lowering it on those in the $40k range it is punishing to those a bit higher on the scale.

In addition, the assumption (well let's be honest it wasn't an assumption he knew he was full of sh!t when he said it wasn't going to affect under $400k) that only those over $400k would have any investments and therefore no-one else would be impacted by drastically jacking up the capital gains rate is ridiculous.

[boozehound]

No, I'm saying I am far under $400k, and that Biden lied when saying his plan wouldn't raise my taxes. By taxing the 401k contributions of those in the $100k range, and lowering it on those in the $40k range it is punishing to those a bit higher on the scale.

In addition, the assumption (well let's be honest it wasn't an assumption he knew he was full of sh!t when he said it wasn't going to affect under $400k) that only those over $400k would have any investments and therefore no-one else would be impacted by drastically jacking up the capital gains rate is ridiculous.

Did you read the plan? You would be contributing after tax dollars to your 401K and receiving a 26% refundable tax credit.

Let's say you make $100K per year and are an individual filer. You would be taxed at a 24% marginal tax rate for anything you earn above $85K. Now lets say you contribute $10K per year to your 401K. In the current system you would normally pay $2400 in taxes on your contribution, but you pay $0 because it is pre-tax income. Under Biden's plan you would pay $2400 in taxes on your contribution at the time you contribute (after tax income at your highest marginal tax rate), however you would receive a $2600 tax credit when you filed your income taxes, which means you would would be $200 better off than the current plan.

I'm not sure what your comment about someone earning $40K is about. Are you saying you are against them receiving a tax benefit for contributing to their 401K, even if you also receive a greater benefit under this plan? That seems a little harsh.

I'm also curious as to how this is raising your taxes, and why you are so worried about the Capital Gains Tax changes proposed. Do you earn over $1MM and pay capital gains tax? If you don't, good news - your rates don't appear to change.

[JEHARDI]

By the way, certifying that Wall Street LOVES Biden, the Dow is up over 1,000 points today.

Yeah, way yo go Elitists!!!!!

You are as bad as the MSM, but keep spinning it to fit your narrative.

[bigdiggins]

Did you read the plan? You would be contributing after tax dollars to your 401K and receiving a 26% refundable tax credit.

Let's say you make $100K per year and are an individual filer. You would be taxed at a 24% marginal tax rate for anything you earn above $85K. Now lets say you contribute $10K per year to your 401K. In the current system you would normally pay $2400 in taxes on your contribution, but you pay $0 because it is pre-tax income. Under Biden's plan you would pay $2400 in taxes on your contribution at the time you contribute (after tax income at your highest marginal tax rate), however you would receive a $2600 tax credit when you filed your income taxes, which means you would would be $200 better off than the current plan.

I'm not sure what your comment about someone earning $40K is about. Are you saying you are against them receiving a tax benefit for contributing to their 401K, even if you also receive a greater benefit under this plan? That seems a little harsh.

I'm also curious as to how this is raising your taxes, and why you are so worried about the Capital Gains Tax changes proposed. Do you earn over $1MM and pay capital gains tax? If you don't, good news - your rates don't appear to change.

My comment on the impact vs $40k was that the justification to eliminate the pretax status is that those at $40k don;t get as big of a benefit as those at $100k. So punish the $100k because the $40k doesn't get as big. $100k is not exactly rich. Color me extremely skeptical that I don't somehow phase out of the tax credit. I'd also much rather have that in my 401k earning 15% this year, than waiting on a return from the govt.

On the capital gains I had not seen that it is only raising on $1M earners. Further research shows that while I hope this someday affects, me it likely will not. :)

[boozehound]

My comment on the impact vs $40k was that the justification to eliminate the pretax status is that those at $40k don;t get as big of a benefit as those at $100k. So punish the $100k because the $40k doesn't get as big. $100k is not exactly rich. Color me extremely skeptical that I don't somehow phase out of the tax credit. I'd also much rather have that in my 401k earning 15% this year, than waiting on a return from the govt.

On the capital gains I had not seen that it is only raising on $1M earners. Further research shows that while I hope this someday affects, me it likely will not. :)

I actually agree with you that I, personally, prefer the idea of contributing pre-tax vs receiving a credit. I think this is far from the end of the world though, and I'm willing to pay a little more in taxes here and there if it helps get the middle class on the right track. Right now many middle class families have very little retirement savings, and I think that's going to be a big issue for America in the next 20 years. I'm personally invested in keeping my money right now, but I'm also personally invested in my investment portfolio holding water and growing for the next 40+ years. I think it's going to be hard to do that if we don't have a strong middle class.

I really don't this plan as being something particularly radical that we should be fired up about.

[chico]

I don't know what's worse - the wailing and gnashing of teeth four years ago by the dems when Hillary lost or all the cries of a rigged election this year by republicans.

[GoMuskies]

I don't know what's worse - the wailing and gnashing of teeth four years ago by the dems when Hillary lost or all the cries of a rigged election this year by republicans.

This year, because my sports betting funds are essentially locked down until the Republicans concede or it becomes officially official. I need that money for frivolous Masters wagers!

[JTG]

I actually agree with you that I, personally, prefer the idea of contributing pre-tax vs receiving a credit. I think this is far from the end of the world though, and I'm willing to pay a little more in taxes here and there if it helps get the middle class on the right track. Right now many middle class families have very little retirement savings, and I think that's going to be a big issue for America in the next 20 years. I'm personally invested in keeping my money right now, but I'm also personally invested in my investment portfolio holding water and growing for the next 40+ years. I think it's going to be hard to do that if we don't have a strong middle class.

I really don't this plan as being something particularly radical that we should be fired up about.

Shouldn't the plan be "after tax contribution and a credit ? If the contribution is pre tax plus a credit, you are getting credited double. Yes ?