Biden Wants to Socialize 401 K Plans
When a potential President of the United States writes up recommendations with a full-blown socialist, lookout. That is what you get with the Biden-Sanders Unity Task Force Recommendations. In a recent Forbes article written by contributor Elizabeth Bauer, she took the task of going through the proposal and wrote this:
Bauer claimed that this proposal “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 expenditures,’ as they’re called, disproportionately accrue to relatively higher earners,” she added, “and the hope of a change is to provide benefits in equal measure to all income groups.”
Instead of getting the tax deduction, you would get a percentage tax credit for every dollar invested. Why do this? Wait for it…..
Roll Call picked up on the theme, arguing that instead of pretax contributions that give more significant tax advantages to the rich, a uniform flat-tax credit would be instituted for everyone.
A Biden advisor said this to the Wall Street Journal in 2018 about this horrible “disadvantage.” He said, “that because lower-income individuals don’t pay taxes, they’re disproportionally denied the benefits of tax deferral.”
Seriously you can’t make this stuff up. I don’t know what the break-even point is, but their definition of rich probably starts for people making below 100,000 and making contributions.
It is a hidden tax on a good percentage of people who probably wouldn’t call themselves rich. Then those who don’t pay taxes will not only not pay taxes; they will get money back because of a tax credit.
This is classic socialism – redistribution from the “rich.” We certainly wouldn’t want those who have been successful to pay less taxes. Welcome to the success penalty!