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Threats for Retirement Accounts
Old 03-10-2015, 11:02 AM   #1
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Threats for Retirement Accounts

I opened up Fedsmith this morning and was surprised to see this article:

8 Threats for Retirement Accounts Under President Obama’s 2016 Proposed Budget : FedSmith.com

Several proposed changes that would impact Roth IRAs, RMDs, and File and Suspend.
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Old 03-10-2015, 11:18 AM   #2
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Pretty nerve-wracking - - a lot of married couples use File and Suspend and at this stage it's hard to know how or if they will be impacted.
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Threats for Retirement Accounts
Old 03-10-2015, 11:37 AM   #3
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Threats for Retirement Accounts

I'm generally progressive in my viewponts and support things that address tax loopholes, however eliminating the "stretch IRA" (of which I had been unaware before reading Slott's Retirement Savings Time Bomb) doesn't seem to me like a good idea in the future. The tax-deferred IRA is (eventually) taxed.
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Old 03-10-2015, 11:43 AM   #4
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File and Suspend and the Roth RMDs are both pretty impactful.
Also the 5 year rule on inherited IRA. Hopefully they'd grandfather in those of us who are stretching beneficiary IRAs.
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Old 03-10-2015, 11:55 AM   #5
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Originally Posted by steelyman View Post
I'm generally progressive in my viewponts and support things that address tax loopholes, however eliminating the "stretch IRA" (of which I had been unaware before reading Slott's Retirement Savings Time Bomb) doesn't seem to me like a good idea in the future. The tax-deferred IRA is (eventually) taxed.
Yeah, but they want the taxes NOW!

I try not to get excited about changes that are only in the discussion stage but this would be a killer for DS and DDIL. DS is the beneficiary of my IRAs (DH is taken care of with a trust and is 76, so unlikely to outlive me). They'd get clobbered with taxes if they had to liquidate over 5 years.

If this goes through I'll have a conversation with my brother the tax accountant and see if we need to change strategies.


I'm also concerned about the ceiling on the accumulations in before-tax accounts. It seems like a reasonable amount today but if they keep it fixed like the AMT threshold (rather than increasing it for inflation), it will affect a lot more people over time.
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Old 03-10-2015, 01:25 PM   #6
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Threats 5 and 6 are pretty silly. I believe we beat a dead horse in another thread on 6.
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Old 03-10-2015, 01:40 PM   #7
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Gees... 10% of rertirement plan participants have over $3.4 million in their accounts? HOW?? By investing in Energy 100% when Energy was up??
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Old 03-10-2015, 01:50 PM   #8
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Gees... 10% of rertirement plan participants have over $3.4 million in their accounts? HOW?? By investing in Energy 100% when Energy was up??
no, the 3.4M limit is reduced for commencement prior to age 62 using "current" interest rates - it's actually pretty easy for the limit to apply to rank and file employees. I posted a link on the other thread to an ebri study.
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Old 03-10-2015, 02:16 PM   #9
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Also the 5 year rule on inherited IRA. Hopefully they'd grandfather in those of us who are stretching beneficiary IRAs.
No worries.


Quote:
The proposal would not affect those who already have beneficiary IRAs, but would impact those who inherit in 2016 and beyond.
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Old 03-10-2015, 06:01 PM   #10
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I recall at least one prior thread on this.

My guess is that all of these are DOA with the current Congress.

None of them would "threaten" my retirement.
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Old 03-10-2015, 10:16 PM   #11
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#3-Eliminate the Special Tax Break for NUA would hurt me and make me seriously consider a 2015 ER instead of 2016.

Edit: Looks like there is a exemption for those who have reached age 50 as of December 31, 2015. OMY is still alive and well.
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Old 03-11-2015, 12:19 PM   #12
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This can be simplified to saying he wants higher taxes on attempts to save money for retirement and descendants. I.e., government first, you & your family later.
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Old 03-11-2015, 12:46 PM   #13
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I recall at least one prior thread on this.

My guess is that all of these are DOA with the current Congress.

None of them would "threaten" my retirement.
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