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A controversial idea to overhaul the tax treatment of 401(k)s from the Brookings Institution has been reincarnated after failing in Senate committee hearings last year. The specific provision would make 401(k) contributions no longer excluded from taxable income, though the government would provi

Dec 12, 2012 by Michael from Kansas City, MO in  |  Flag
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11 votes
Peter C. Karp Level 20

Michael,

No, I do not see this proposal gaining any traction as there is a savings crisis in this country. Social Security is strained given the number of baby boomers retiring. The government does not have the money to provide matching contributions to participant accounts as they have other priorities. As the saying goes….talk is cheap.

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Comment   |  Flag   |  Dec 13, 2012 from San Francisco, CA

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4 votes
James Holland Level 18

A treasure trove and answer to budget woes, these savings accounts are ubiquitous and the number one item on family balance sheets after their home's unrealistic appreciation was corrected in 2007 and beyond. Combine this fact with the other related fact that 80 million baby boomers shall rely heavily on this account versus their unfunded entitlement program call Social Security, Congress' actions against this savings account would be political suicide.

Comment   |  Flag   |  Dec 13, 2012 from Charlotte, NC

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2 votes

As we have all seen, the government can pretty much do whatever it wants. If they decide to make drastic changes to the Qualified Plan rules, I would be no more surprised than when the government Nationalized the auto industry.

Comment   |  Flag   |  Dec 13, 2012 from Austin, TX

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