Home › Forums › Financial Markets/Economics › OT: 529 change proposal
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joec.
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January 27, 2015 at 2:23 PM #782356January 27, 2015 at 3:43 PM #782357
FlyerInHi
Guest[quote=joec]
Discussion is fine, just the endless what IF, this That, ETC…on and on, etc…sounded like more freaked and worried to me.
[/quote]It’s the same kind of wacked discussions about the likelihood of the government confiscating guns, etc…
There’s a process for things to get done. Proposals have to make it into actual legislations. Congressional leaders then to have to allow legislations to get voted on and passed by both houses. The President then needs to sign laws passed by Congress.
But still some people want to argue that just because there a proposal to change 529 that it then follows that Roth IRAs and 401ks would likely be retroactively taxed. What likelihood?
January 27, 2015 at 4:44 PM #782359SK in CV
Participant[quote=AN] But its good to see where the president want to get more revenue for his spending.[/quote]
Your framing is revealing. At least so far, this isn’t a proposal to get more revenue or to increase spending. It’s a proposal to redirect tax expenditures.
January 27, 2015 at 4:48 PM #782358
CoronitaParticipant[quote=FlyerInHi][quote=joec]
Discussion is fine, just the endless what IF, this That, ETC…on and on, etc…sounded like more freaked and worried to me.
[/quote]It’s the same kind of wacked discussions about the likelihood of the government confiscating guns, etc…
There’s a process for things to get done. Proposals have to make it into actual legislations. Congressional leaders then to have to allow legislations to get voted on and passed by both houses. The President then needs to sign laws passed by Congress.
But still some people want to argue that just because there a proposal to change 529 that it then follows that Roth IRAs and 401ks would likely be retroactively taxed. What likelihood?[/quote]
It’s not a wacked discussion at all. We’re fine as long as we have sufficient bi-partisanship in our Congress + Executive branch to keep each other in check. But if at all one party dominates government, there’s a much bigger chance of things getting passed, for better or worse. I don’t think people really believe this would have been passed in our current balanced government. It’s more about the more lunacy of the proposal.
But you are correct, that the likelihood of a retroactive tax on the 529 was unlikely. Because I’m sure many of our politicians who contributed to this plan probably had much more money tucked away into 529’s and would probably want to be grandfathered in so that they wouldn’t have to pay for any sort of retroactive tax..And since they already had theirs, there’s nothing wrong with closing the “tax loophole” for anyone else that wanted to do it after them. Afterall, as long as I get mine, who cares about everyone else, right?
January 27, 2015 at 4:49 PM #782360Participant[quote=flu]It’s more about the more sheer lunacy of the proposal.
But you are correct, that the likelihood of a retroactive tax on the 529 was unlikely. [/quote]
I’m sure why anyone would consider the proposal “lunacy”. Redirecting tax benefits to those who need it most seems pretty logical.
The “retroactive tax” was unlikely because it was never proposed.
January 27, 2015 at 4:58 PM #782361CoronitaParticipant[quote=SK in CV][quote=flu]It’s more about the more sheer lunacy of the proposal.
But you are correct, that the likelihood of a retroactive tax on the 529 was unlikely. [/quote]
I’m sure why anyone would consider the proposal “lunacy”. Redirecting tax benefits to those who need it most seems pretty logical.
The “retroactive tax” was unlikely because it was never proposed.[/quote]
The lunacy is going after a tiny savings plan that encourages individual americans to save/invest( which the last time I checked, would do many americans a good thing that traditionally does a piss-poor job of saving) instead of going after any other sort of “tax loophole” for corporations, hedge funds/private equity, or uber rich people… But I guess those people are important, since they fund campaign contributions, so they must be off limits I guess.
I’m not suggesting we should be taxing corporations, uber rich people more. But if you are going to suggest “taxing the rich more”, don’t you think they should target the actual entities that they are talking about?
That’s the lunacy of this idea.
January 27, 2015 at 4:58 PM #782362Guest[quote=flu]
The lunacy is going after a tiny savings plan that encourages individual americans to save/invest( which the last time I checked, would do many americans a good thing that traditionally does a piss-poor job of saving) instead of going after any other sort of “tax loophole” for corporations, hedge funds/private equity, or uber rich people… But I guess those people are important, since they fund campaign contributions, so they must be off limits I guess.[/quote]Nothing of the sort.
The 529 plan has very low appeal. The proposal is to develop college incentives that have broader public reach.
January 27, 2015 at 5:41 PM #782363CoronitaParticipant[quote=FlyerInHi][quote=flu]
The lunacy is going after a tiny savings plan that encourages individual americans to save/invest( which the last time I checked, would do many americans a good thing that traditionally does a piss-poor job of saving) instead of going after any other sort of “tax loophole” for corporations, hedge funds/private equity, or uber rich people… But I guess those people are important, since they fund campaign contributions, so they must be off limits I guess.[/quote]Nothing of the sort.
The 529 plan has very low appeal. The proposal is to develop college incentives that have broader public reach.[/quote]
And like I said over and over again. Those college incentives could have been paid from taxes from truly “rich people/corporations”… It could have come out of our defense’s budget.
Why did they specifically pick the 529 plan, besides it was an easy target that people *thought* (since only a minority of group of people have them)…there would be no backlash against and could be crammed down people’s throat…
So the messaging is “let’s tax people who consciously save/invest and plan for the future instead of make good decisions on our country’s budget and allocate money elsewhere for this greater cause…And while we’re at it, let’s call the 529 plan a “rich person’s plan” so we can get more of the lemmings to agree to this, since well, so many people hate/envy more successful people in this country now anyway…”
School bully much?
Yes, that doesn’t sit too well with me…
January 27, 2015 at 6:54 PM #782366EconProf
ParticipantApparently the Obama administration now agrees with flu.
They just dropped their proposal to tax 529 accounts.
Perhaps they read the pro and con arguments on Piggington.January 27, 2015 at 11:11 PM #782368an
Participant[quote=SK in CV][quote=AN] But its good to see where the president want to get more revenue for his spending.[/quote]
Your framing is revealing. At least so far, this isn’t a proposal to get more revenue or to increase spending. It’s a proposal to redirect tax expenditures.[/quote]hmmm…
Washington Post: “President Obama unveiled an ambitious $3.9 trillion budget blueprint Tuesday that seeks billions of dollars in fresh spending to boost economic growth but also pledges to tame the national debt by raising taxes on the wealthy, slashing payments to health providers and overhauling the nation’s immigration laws.” http://www.washingtonpost.com/blogs/wonkblog/wp/2014/03/04/obama-budget-seeks-new-spending-new-taxes-to-boost-economy-tame-debt
Yahoo: “Obama’s 2015 Budget Proposal: More Spending, Less Pretending” http://news.yahoo.com/obama-39-2015-budget-proposal-more-spending-less-141900462.htmlI guess you know something they don’t. Now, that’s revealing.
January 28, 2015 at 5:46 AM #782369Participant[quote=AN][quote=SK in CV][quote=AN] But its good to see where the president want to get more revenue for his spending.[/quote]
Your framing is revealing. At least so far, this isn’t a proposal to get more revenue or to increase spending. It’s a proposal to redirect tax expenditures.[/quote]hmmm…
Washington Post: “President Obama unveiled an ambitious $3.9 trillion budget blueprint Tuesday that seeks billions of dollars in fresh spending to boost economic growth but also pledges to tame the national debt by raising taxes on the wealthy, slashing payments to health providers and overhauling the nation’s immigration laws.” http://www.washingtonpost.com/blogs/wonkblog/wp/2014/03/04/obama-budget-seeks-new-spending-new-taxes-to-boost-economy-tame-debt
Yahoo: “Obama’s 2015 Budget Proposal: More Spending, Less Pretending” http://news.yahoo.com/obama-39-2015-budget-proposal-more-spending-less-141900462.htmlI guess you know something they don’t. Now, that’s revealing.[/quote]
No, not something that they know and I don’t. It’s something I know and you don’t. Context is everything. We haven’t been talking about the budget as a whole, we’ve been talking about a single proposal. And this particular proposal is one that would replace one tax expenditure with another. Not new spending.
It’s now a dead deal. It shouldn’t be. But Obama is a realist. He knows how politics work. And this small proposal wasn’t worth the fight. And he knows at this point he’s just as likely to get what he wants with new spending. Though neither are too likely. Republicans in congress never met a tax cut they didn’t like. Unless it benefits low and middle income taxpayers. And this one does.
January 28, 2015 at 9:14 AM #782371Participant[quote=SK in CV]
No, not something that they know and I don’t. It’s something I know and you don’t. Context is everything. We haven’t been talking about the budget as a whole, we’ve been talking about a single proposal. And this particular proposal is one that would replace one tax expenditure with another. Not new spending.It’s now a dead deal. It shouldn’t be. But Obama is a realist. He knows how politics work. And this small proposal wasn’t worth the fight. And he knows at this point he’s just as likely to get what he wants with new spending. Though neither are too likely. Republicans in congress never met a tax cut they didn’t like. Unless it benefits low and middle income taxpayers. And this one does.[/quote]LoL, just saying you know something doesn’t make it true. But whatever. It’s dead now. Just like SCA-5.
January 28, 2015 at 5:22 PM #782401CA renter
ParticipantFWIW, SK knows what he’s talking about regarding taxes and fiscal policies.
January 28, 2015 at 6:11 PM #782405joec
ParticipantNo surprise this was dropped. Honestly, I know for a fact (as fact as it can be at least), that there will be no major tax reform in the next 2 years with a divided Congress. Be safe knowing in any discussion that nothing major will be done so please, there is no need at all to worry. Really.
If they can’t stop and tax Yahoo for their AliBaba profits (saving 14 billion), good luck trying to pass anything major anytime soon.
I actually support 0% corporate tax rates for this reason. Companies already can find ways to pay 0 so to balance it out, maybe just get rid of capital gains, dividends rates and everything else rates and make a sliding scale. It was like this many many years ago, but when tax rates were 75% or some insane value, no one paid that neither…
As mentioned, taxing people with 0 or very low income/assets isn’t going to do/help much.
Too bad the government is controlled by the 0.1% so nothing will be done or changed…ever in my lifetime at least.
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