As part of the process of paying for the new health care entitlement, legislators are now considering a new tax on investment income.
The story.
In part:
Some good news, for now:
At some point I guess we can stop calling it a payroll tax.
It's probably just me, but sometimes I think the govt is now just allowing us to fatten up 401Ks, tIRAs, and Roths for a later slaughter to feed the machine.
The story.
In part:
As many will recall, the tax on "Cadillac" medical plans was intended to discourage profligate use of medical care. It appears the proposed tax on these plans is pinching a favored constituency, so the guns are now turning on those who save and invest. Of course the tax would only affect "the wealthy," (income levels--individual: $200K, joint $250K--the marriage penalty lives on!) so no one else need be concerned about it.WASHINGTON -- House and Senate negotiators are considering applying for the first time the Medicare payroll tax to investment income as part of a compromise to pay for a health overhaul.
The extra Medicare tax would apply only to the wealthy and could allow congressional Democrats to reduce the sting of a tax on high-cost insurance plans, said Democratic aides and others briefed on the negotiations.
Labor leaders complained directly to President Barack Obama on Monday about the tax on high-value plans, which would hit some union members who have negotiated generous health benefits.
Some good news, for now:
If this catches on, I don't doubt that the Social Security portion of the payroll tax will also be applied to investment income.. Income from pensions and retirement accounts, including 401(k) accounts, would be exempt.
At some point I guess we can stop calling it a payroll tax.
It's probably just me, but sometimes I think the govt is now just allowing us to fatten up 401Ks, tIRAs, and Roths for a later slaughter to feed the machine.