I thought I would add a series to this blog called "Things that Make Me Want to Vomit" since it isn't very hard to find these things in the news these days.
Today's entry is from congress (go figure) where they are talking about removing the tax benefits from 401 K's that encourage individual retirement planning. The congressmen even called the lack of taxing this money "subsidies." WARNING! This article may cause excessive vomiting. Read it here.
3 comments:
What tax benefit? The only so-called tax benefit is the deferrment of paying taxes on a 401(k) until one starts receiving one's invested money. Am I missing something here?
Appropriate creative pumpkin, by the way.
It is a big advantage to have the tax deduction now and have it tax deferred because of the compound interest earned over that time even though you are taxed on it at retirement. Use this calculator to see the difference:
http://www.adviserview.com/calculators/invest/taxVsTaxAd_default.asp
The advantage will be even bigger when Obama raises the capital gains tax rates.
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