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Originally Posted by suzzer99
this is basically what I have been wary of as I have contributed in the past. I am also very worried that my Roth contributions will be taxed on withdrawal, but not much I can do if that comes to pass.
One thing I don't understand is why people would think this isn't possible. Basically every single time I have brought this up I have been shut down as being told its not possible, but for no reason other than "they wouldn't do that." Taxing roth retirement accounts with mandatory withdrawals on the gains withdrawn seems like a very straightforward way to raise taxes and taxing gains to some degree in traditional plans also seems like a very simple way to raise revenue. If they don't take away the penalties for early withdrawals they can also "lock in" certain amounts of revenue over time.
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Originally Posted by kerowo
How is that even close to legal?
how would it be illegal? They would just be changing tax laws. There is always risk that what is promised can disappear or be reversed by the government at a later date.
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Originally Posted by Riverman
Taxing 401k accounts, especially on unrealized gains (wtf?) is political suicide. I hope.
I don't think this is likely to come off any worse than a tax increase. In fact, it can be spun a lot better it accompanied by some nominal headline decrease that doesn't actually have a bottomline effect.