Threats for Retirement Accounts

[ABQ2015]

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.

 

[W2R]

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.

 

[steelyman]

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.

 

[rodi]

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.

 

[athena53]

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.

 

[Big_Hitter]

Threats 5 and 6 are pretty silly. I believe we beat a dead horse in another thread on 6.

 

[tmm99]

Gees... 10% of rertirement plan participants have over $3.4 million in their accounts? HOW?? By investing in Energy 100% when Energy was up??

 

[Big_Hitter]

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.

 

[Alan]

Also the 5 year rule on inherited IRA. Hopefully they'd grandfather in those of us who are stretching beneficiary IRAs.

No worries.

The proposal would not affect those who already have beneficiary IRAs, but would impact those who inherit in 2016 and beyond.

 

[Independent]

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.

 

[Samething]

#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.

 

[gerntz]

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.

 

[Options]

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.

+1