Savings Accounts Seized
The United States is a lot like Cyprus. It is a tax haven for the rich and is willing to execute the same tactic, savings accounts seized, as the Cypriot government did in April 2013. Only the US Congress critters and their reptilian leader are more slick.
It is no secret tax reform is on the mind, in the agenda and in the works of the Washington outhouse dwellers. They wring their hands over the spiraling national deficit and national debt out of one side of their mouth while out of the other side of their mouth they increase spending like a drunken sailor on liberty. We will get to savings accounts seized in just a moment.
To solve their problem spending habit they are looking at the other side of the ledger to find their relief. They can only find relief on one side of the budget because cutting spending isn’t a topic for discussion.
Savings accounts come in many forms. You could have a plain vanilla savings account at your local bank or credit union. Or, you could have a tax-qualified retirement plan like a 401(k) or some other type of employer sponsored tax-qualified retirement plan as a savings account.
The tax reformers, or as properly described income vultures, are considering eliminating your tax-qualified plan or putting severe limitations on how much you can save in those plans.
According to Market Watch in an article dated April 19, 2013:
“The just-released fiscal year 2014 budget is the most recent attempt to limit the size of these plans by prohibiting individuals from accumulating over $3 million in IRAs and other tax-preferred retirement accounts. The $3 million figure is tied to an amount sufficient to finance an annuity of not more than $205,000 per year in retirement, which is also the current maximum benefit permitted to be paid under a qualified defined benefit plan in 2013 and is adjustable for increases in cost of living. It looks like this is another attempt to increase the taxes paid by the so called “1 percenters” but the impact might be wider.”
If this isn’t a savings accounts seized maneuver I don’t know what is. In fact Market Watch goes on and says:
“The Administration expects to raise $9 billion over 10 years with this new plan. But given the magnitude of the U.S. budget problem and the size of tax expenditures associated with 401(k) type plans ($429 billion between 2013 and 2017), it would not be surprising to see additional tax reform proposals that would further limit contributions to tax qualified retirement plans, and not just for wealthy taxpayers.”
Read both of those paragraphs one more time because you are in their plans and your savings account will be one of those savings accounts seized. Not only are the pond scum talking about limiting how much you can save for YOUR retirement but they are telling you they plan to put additional limits on you in the future.
The savings accounts seized mentality continues in that it would limit tax-deferred contributions to retirement accounts to the lesser of $20,000 a year or 20% of income. They call it the 20-20 cap. Market Watch explained it thusly:
“This “20-20 cap” would also include the employer contribution. To illustrate, consider a regular Joe with an income of $75,000 and an employer contribution of $4,000. Under the current system, he is allowed to save up to $17,500 in his 401(k) plus the employer match, on a pretax basis. Under the 20-20 plan, this person can only save $11,000 after his employer match. The remaining $6,500 would be included in taxable income, thereby increasing his April 15 tax bill.”
If this all goes through as reported, savings accounts seized will be mission accomplished. You will know communism from living breathing first-hand experience.
Savings accounts seized sounded like this article would talk about a foreign country. Fooled you, right?
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