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Old 11-06-2009, 01:22 PM   #61
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My point is some people have opinions that don't have any basis in reality.
I particularly am amused by the Medicare recipients who are against government-sponsored health care. Clueless...
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Old 11-06-2009, 01:39 PM   #62
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I particularly am amused by the Medicare recipients who are against government-sponsored health care. Clueless...
I feel the same way about anyone in favor of expanding government-sponsored health care.

Alot harder to get the camel out of the tent once it has already stuck it's nose in!
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Old 11-06-2009, 01:39 PM   #63
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I particularly am amused by the Medicare recipients who are against government-sponsored health care. Clueless...
Absolutely. We are all just doddering old fools who can't even remember what day it is. No wonder me make such stupid mistakes. Just keep thinking that.

Ha
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Old 11-06-2009, 01:49 PM   #64
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Though I can see why this "subsidy" approach is attractive . . .
It's attractive because you can say the word "subsidy" without saying the word "tax". Your lips don't even move the same. Some people might want to believe you kept your promise not to raise certain taxes.

But whether I end up paying more, or pay the same but get less of a subsidy, it is all the same amount of money out my pocket and into the govt pocket. If it looks like a duck, walks like a duck and quacks like a duck....


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Oh baloney.
Well, I guess we will have to agree to disagree. But this time, at least Merriam Webster and George Stephanopoulos are on my side.

Obama: Mandate is Not a Tax - George's Bottom Line

(and see the videos I posted a few back)

-ERD50
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Old 11-06-2009, 02:11 PM   #65
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I second that. I consider it wrong for the government to essentially change the rules of a ROTH after the fact. I'm no lawyer, but in the private sector I think that would be called "breach of contract".

If they want to change it going forward, well, I may not like it but at least it isn't screwing the person that tried to play by the rules.

-ERD50
Talk to the GM bond holders about that...
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Old 11-06-2009, 02:24 PM   #66
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Well, I guess we will have to agree to disagree. But this time, at least Merriam Webster and George Stephanopoulos are on my side.

Obama: Mandate is Not a Tax - George's Bottom Line

(and see the videos I posted a few back)

-ERD50
The only relevant definitions are what are under the tax code regarding income tax exemptions. The Roth is exempt from income tax and a subsidy for others is not an income tax to the holder of the Roth. There still will not be an income tax on your Roth. So, I still call baloney.

There is no indication of any legislative intent that a Roth not be considered as income for the purpose of public assistance and in fact it is considered.

BTW, the Roth is not exempt from all tax. If you die the Roth is considered part of your estate and can be subject to estate taxes.

So double baloney.
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Old 11-06-2009, 03:04 PM   #67
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. But this time, at least Merriam Webster and George Stephanopoulos are on my side.

Obama: Mandate is Not a Tax - George's Bottom Line
The Stephanopoulos interview is well done and interesting to watch. He pressed Obama but yet respected his authority to have the last word, or should I say "wordsmithing?"

As far as the meaning of the word "tax," the discussion here is probably making far too much of the definition. You're from northern Illinois and should be well aware of how politics works in Chicago/Cook County. We've all listened to Daley, Blagojevich, Stroger and the others talk about not wanting to increase "taxes" and therefore are going to do "X," "Y," and "Z" to increase gov't revenue. Of course these alternatives amount to simply some other means of transfering money from private coffers to gov't coffers.

I think as RE's, or RE Wannebee's, we need to consider the financial impact, in regards to our retirements, of any movement of money, direct or indirect, from our resources to someone else's as that movement will affect our FIRE viability. Whether it's a "tax" or some other methodology, it needs to be understood and made a part of our planning.
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Old 11-06-2009, 03:40 PM   #68
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The only relevant definitions are what are under the tax code regarding income tax exemptions. The Roth is exempt from income tax and a subsidy for others is not an income tax to the holder of the Roth. There still will not be an income tax on your Roth. So, I still call baloney.

There is no indication of any legislative intent that a Roth not be considered as income for the purpose of public assistance and in fact it is considered.

BTW, the Roth is not exempt from all tax. If you die the Roth is considered part of your estate and can be subject to estate taxes.

So double baloney.
But Medicare was never intended or sold to the public as a welfare program. Middle class people would likely have never gone along with it if it had been. Public assistance is a welfare program, and was presented as such.

Your very careful definition of a tax is reminding me of Mr. Clintons's immortal words "It depends on the definition of is."

Ha
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Old 11-06-2009, 06:04 PM   #69
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It appear the AMA may withdraw support for the House Bill.

AMA's Endorsement of House Health Care Bill Sparks Internal Uprising - FOXNews.com
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Old 11-06-2009, 06:45 PM   #70
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But Medicare was never intended or sold to the public as a welfare program. Middle class people would likely have never gone along with it if it had been. Public assistance is a welfare program, and was presented as such.

Your very careful definition of a tax is reminding me of Mr. Clintons's immortal words "It depends on the definition of is."

Ha
My "very careful definition" is the only thing that is important. What does the tax code say. Not what does a dictionary say. The stated presumption of the tax code is that income in whatever form will be taxed unless the code specifically says it won't. The tax code makes the Roth exempt from income tax. It does not exempt it from estate taxes. It does not say that Roth payments may not be considered when determining eligibility for government benefits.

No need to tax yourselves, the code says what it says.
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Old 11-06-2009, 08:20 PM   #71
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The Stephanopoulos interview is well done and interesting to watch. He pressed Obama but yet respected his authority to have the last word, or should I say "wordsmithing?"
Yes, I was surprised to see George push as hard as he did. It was well done, even if I may have wanted him to push it just one little step further...

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As far as the meaning of the word "tax," the discussion here is probably making far too much of the definition. ...

Of course these alternatives amount to simply some other means of transfering money from private coffers to gov't coffers.

.... Whether it's a "tax" or some other methodology, it needs to be understood and made a part of our planning.
Exactly. I think the dictionary definition denial is interesting, but the change left in my pocket is the real measure of how much I am "taxed".


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BTW, the Roth is not exempt from all tax. If you die the Roth is considered part of your estate and can be subject to estate taxes.

So double baloney.
You can triple baloney it if you wish (and I'll triple "smiley" it in case anyone gets the impression that is anything more than good-natured ribbing).

I don't recall the govt ever telling me that the ROTH would be exempt from Estate taxes, so that isn't changing the rules on me. It is what it is.


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My "very careful definition" is the only thing that is important. What does the tax code say. Not what does a dictionary say.

....

It does not say that Roth payments may not be considered when determining eligibility for government benefits.
I disagree. What you are describing are the semantics of the word "tax". Maybe that is all that is relevant to a tax attorney, but I suspect the average taxpayer would say that what is left in their pocket is more relevant than the tax code definition of a "tax".

If a Roth withdrawal makes me ineligible for a subsidy, or credit or deduction, or whatever, that leaves less money in my pocket. And in that case it would be attributed directly to the Roth income. So it is in effect, an "income tax", even if the taxman gives it another name. If the taxman finds a way to return that money to my pocket, I'll call it even.

-ERD50
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Old 11-06-2009, 09:11 PM   #72
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The only way around the feeling of being taxed opn the ROTH that I can see is fairly simple but not a whole lot of fun. Do not take distributions and qualify for gov't subisidies all the way around. Late in the game you can have a lot to play on or the Humane Society or the kids will appreciate it! That is the only other option I can see happening.
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Old 11-06-2009, 10:02 PM   #73
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I disagree. What you are describing are the semantics of the word "tax". Maybe that is all that is relevant to a tax attorney, but I suspect the average taxpayer would say that what is left in their pocket is more relevant than the tax code definition of a "tax".

-ERD50
The average person has a basic understanding of income tax. It is tax on income that you have to pay unless the rules say otherwise.

A person might be pissed if they are not eligible for a subsidy and look for ways to get one.

But the average person knows that what the law says governs and knows that if their expectations are different than the law that they are out of luck. It isn't "breach of contract" to have unrealistic expectations dashed. And I question how many people really have the expectation that they can get any sort of subsidy meant for low income people if their income is high income but only due to Roth distributions.

Desire and knowledge are two different things.
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Old 11-07-2009, 10:25 AM   #74
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The average person has a basic understanding of income tax. It is tax on income that you have to pay unless the rules say otherwise...............

But the average person knows that what the law says governs and knows that if their expectations are different than the law that they are out of luck..............

We'll have to wait and see what the actual legislation, including any related changes to the tax code, looks like.

As it pertains to FIRE planning and RE expense management, the current thousands of pages of complicated tax code are hardly something the average person has a grasp of and are often interpreted with a wide range of outcomes by lawyers, so-called tax experts, the IRS and the courts. I'm looking forward (NOT!)to seeing what the Congress Critters do this time. It would be a real change if the new rules are written so that the average person (in our case FIRE planner or RE manager) can handle them without professional help.
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Old 11-07-2009, 01:34 PM   #75
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I'm all for the health care bill to pass during this window of opportunity. Being able to get and keep health care as long as the premiums are paid without worrying if one's pre-exisiting condition requirements are met or worrying about look back rules would be progress enough.
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Old 11-07-2009, 06:45 PM   #76
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For some insight how a good idea has gone terribly bad, please read about some of the "wonderful" provisions of the House bill as described in this WSJ piece
Betsy McCaughey: What the Pelosi Health Care Bill Really Says - WSJ.com

As an example this proposed revision to Medicare
Sec. 1302 (pp. 672-692) moves Medicare from a fee-for-service payment system, in which patients choose which doctors to see and doctors are paid for each service they provide, toward what's called a "medical home."
The medical home is this decade's version of HMO-restrictions on care. A primary-care provider manages access to costly specialists and diagnostic tests for a flat monthly fee. The bill specifies that patients may have to settle for a nurse practitioner rather than a physician as the primary-care provider. Medical homes begin with demonstration projects, but the HHS secretary is authorized to "disseminate this approach rapidly on a national basis."
Obama may claim everyone can keep their docs but the legislation clearly indicates it is only a matter of time until everyone must comply with a govt determined gate keeper for services.
There was news clip from the Republicans this am detailing over 100 new agencies estasblished by this legislation. Some examples were these come from in found in
• Sec. 399V (p. 1422) provides for grants to community "entities" with no required qualifications except having "documented community activity and experience with community healthcare workers" to "educate, guide, and provide experiential learning opportunities" aimed at drug abuse, poor nutrition, smoking and obesity. "Each community health worker program receiving funds under the grant will provide services in the cultural context most appropriate for the individual served by the program."
These programs will "enhance the capacity of individuals to utilize health services and health related social services under Federal, State and local programs by assisting individuals in establishing eligibility . . . and in receiving services and other benefits" including transportation and translation services.
Guess we have identified the future for Acorn?
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Old 11-07-2009, 08:14 PM   #77
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Guess we have identified the future for Acorn?
Possibly. Or perhaps a return to the "good ole days" I experienced growing up in Democratic Machine Chicago with several extended family members employed by the city. The pace and direction of our lives were set by our precinct captain, the ward committeman (ward boss) and on up the ladder. Now perhaps those folks will also be able to poke their fingers into your access to medical care. Oh boy.......... Grandpa needs a new hip? Go see the ward boss and he will likely say something like "Well, lets take a look at how many hours you've logged doing political work and we'll see what we can do......"

My fears are probably exaggerated. But in our neighborhood in the Richard J Daley days, it was a pretty darn tight political ship! So, for me, any thought of "community political action groups" being involved in rationing medical services is scary.
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Old 11-07-2009, 09:40 PM   #78
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The average person has a basic understanding of income tax. It is tax on income that you have to pay unless the rules say otherwise.
I'm with youbet on this - I've gotta think that your standing as a tax expert may have distorted your view of what the average person understands about taxes. That's probably not uncommon with experts in their fields. To me, that sounds a bit like saying the average person has a basic understanding of Quantum Mechanics, if they recognize it has something to do with energy and atoms, and some rules apply Those darn, pesky rules!

Even Timothy Geithner (considered by many to be above average in knowledge of tax matters) had trouble with that pesky definition of "income"!

But it's a bit of a sidetrack to the OP, so I'll start a new thread on the subject if you care to discuss further, let me know.

-ERD50
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Old 11-07-2009, 10:25 PM   #79
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Am I the only one who considers this a total debacle? Your kids and grandkids are going to pay trillions of dollars so we all can suck off the pig. Not only that, this pig that all are trying so hard to analyze whether 'I will be better off or worse off' will likely turn around and bite us all.

This will not end well, sad to say. Since when did the federal government take over anything and make it better?

Just a sad day when we all put so much faith in the government doing things better than private capitalism does. There are problems, to be sure, but nothing deserving this.

Just a sad day, for sure.
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Old 11-07-2009, 10:48 PM   #80
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Uh, oh. Looks like the House passed this monstrosity.

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WASHINGTON In a tight vote, the House passed its sweeping health bill late Saturday, marking the biggest victory yet for Democrats in their drive to create near-universal health insurance.
The bill passed by a 220-215 margin, with one Republican, Anh "Joseph" Cao of Louisiana, joining 219 Democrats in favor. Thirty-nine Democrats voted against the bill. The passage came after House leaders made a surprise last-minute concession that blocks abortion from the new government insurance plan in order to win over wavering Democrats.
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