Closed off from flow
They thought they’d cause some pain
Once or twice was enough
And it was all in vain
Time starts to pass
Before you know it they’re frozen

But something happened
For the very first time with you
Spending melts into the ground
Found something true
And everyone’s looking round
Thinking I’m going crazy

But they don’t care what you say
They’re in love with now
They try to pull you away
But they don’t know the truth
Our heart’s crippled by the vein
That we keep on funding
They cut it open and they

Keep taxing
Keep, keep taxing more
They keep taxing
They keep, keep taxing more
Keep bleeding
Keep, keep bleeding love
They cut me open

Trying hard not to hear
But they talk so loud
Their piercing sounds fill my ears
Try to fill me with doubt
Yet I know that the goal
Is to keep me from saving

But nothing’s greater than the rush that comes with your return
And in this world of spending
I see the fate
Yet everyone around me
Thinks that I’m going crazy, maybe, maybe

But they don’t care what you say
They’re in love with now
They try to pull you away
But they don’t know the truth
Our heart’s crippled by the vein
That we keep on funding
They cut it open and they

Keep taxing
Keep, keep taxing more
They keep taxing
They keep, keep taxing more
Keep bleeding
Keep, keep bleeding love
They cut me open

And it’s draining all the capital
Oh they find it hard to believe
You’ll be wearing these scars
For everyone to see

But they don’t care what you say
They’re in love with now
They try to pull you away
But they don’t know the truth
Our heart’s crippled by the vein
That we keep on funding
They cut it open and they

Keep taxing
Keep, keep taxing more
They keep taxing
They keep, keep taxing more
Keep bleeding
Keep, keep bleeding love
They cut me open

“Is your 401(k) safe from the tax man? That’s a question that might be worth asking, as the congressional “supercommittee” scrambles to find $1.5 trillion in additional deficit cuts.

In September, the Senate Finance Committee held a little-noticed hearing that explored changes to retirement plans — principally employer-sponsored 401(k)s — that would in one way or another cut their tax deductions.

The tax breaks’ size makes them a tempting target for lawmakers. According to the White House budget office, tax exemptions for 401(k)s and IRAs will “cost” the government more than $436 billion over the next five years.”

Sigh.

By its very definition, 401K/TSP/IRA contributions are not taxed when they go into the account, compound for (hopefully) 30-40 years, and then are taxed upon withdrawal. Withdrawing is NOT optional so it is an anticipated revenue based on whatever the tax rates are 30-40 years from now. (Higher)

Taxing it when it before it goes in and then taxing it when it comes out is the very definition of double taxation.

So, will Sam be more likely to take the up front revenue, have less principal compounding, then take their share when people withdraw? Hence the phrase, “Let the people pay on both ends.” -not sourced, “Why tax once when you can tax twice or thrice.” -not sourced and “Why should they get to keep any of it?” - not sourced

However, if an individual is getting their company match, they should still donate for the max company contribution and then focus on their ROTH IRA contributions. Roth contributions are already taxed before they go in, compound, and then withdrawals are not taxed.

“One idea pitched at the Senate hearing is to replace the entire tax deduction with a flat government match of 18% to 30%. The Brookings Institution’s William Gale, who helped develop the idea, says if the credit were set at 18%, it would boost tax revenues by $458 billion over 10 years, mostly from wealthier workers.”

Seeing as Sam matches his workers with a conservative match already and when coupled with pensions, all paid for by tax payers, this is an idea I could get behind…if there was not a sneaky ninja cutting a hole in my pocket from an ammendment in the bill. If 18-30% of savings contributions were matched, this would incentivize savings. One would think you might get more of it. But how many people are thinking even 5 years out, much less 30?

“Obama’s National Economic Council chairman, Gene Sperling, also has endorsed scrapping the tax deduction in favor of a refundable tax credit.”

So they just want to take it, and then give it back? Something tells me that allowing magicians to take your wallet and then ‘give it back with everything and more in it’ and then allowing them to walk behind the curtain with it is not a good idea…then again, magicians should always be questioned…their need for control is not easily quenched…guess it is all those 7 year old birthday parties that sets that aura of control in motion.

“President Obama’s debt commission proposed cutting the annual cap on 401(k) employer/employee combined contributions to $20,000 from $49,000 now. (The individual limit is $16,500 a year; workers age 50 and older can add another $5,000).”

“Jack VanDerhei, research director at the Employee Benefits Research Institute and a leading pension expert, says they could severely cut how much money that workers and employers set aside. He says the $20,000 cap would even hit lower-income workers, causing “a significant reduction” in their retirement savings.”

So it isn’t just ‘hitting the wealthy’ to bring back main street, it is a methodical tax that hits everyone, reduces their deductions, gives some back, discourages savings, reduces capital that can compound, still keeps withdrawal quotas and tax upon withdrawal….

Seems to me that setting the rules to the game and letting the players play is the best route. You don’t change the rule so you get $150 when passing go and $50 when passing free parking…and you certainly don’t change those amounts to a respective $125 and $25 and tell people that they’re really getting more cash and everyone can afford St. James Place because lets face it…Park Place is overrated.

/end thought

Time for work, it is a wonderful rainy Thursday, hope the bike tires hold.