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Ira confiscation?
Posted: Sat May 22, 2021 8:56 pm
by murphy_p_t
In light of the debt of the US federal government and the direction of politics, is a government takeover of ira accounts on the horizon?
I thought this was a good article with insightful comments. I think the risk might be greater than the author suggests in his article, however.
https://cashmoneylife.com/can-the-us-go ... 1k-or-ira/
Re: Ira confiscation?
Posted: Sat May 22, 2021 9:39 pm
by Maddy
The author's premise--that this kind of taking of private property, although theoretically possible, would encounter a daunting array of legal and procedural roadblocks--seems strangely at odds with everything we've learned over the past year. Hasn't it been made clear that the government can, and will, do anything it damned pleases--and without so much as a passing nod to constitutional or statutory limitations on its power? And that there is no legal recourse for even the most flagrant overreaches because the judiciary has sold itself off to the highest bidder? And, aside from (bless-his-heart) Rand Paul and a handful of likeminded others, nobody in Congress even believes in freedom or private property any more?
Re: Ira confiscation?
Posted: Sat May 22, 2021 10:56 pm
by murphy_p_t
I share your perspective.
Re: Ira confiscation?
Posted: Sat May 22, 2021 11:38 pm
by murphy_p_t
Until I read the last paragraph, tom, I thought someone had hacked your account
Re: Ira confiscation?
Posted: Mon May 24, 2021 9:56 am
by WiseOne
Yes there is a way to confiscate IRA accounts: include them as assets for a wealth tax. Anyone know where that bit of legislation stands?
Inclusion of IRAs in the asset calculation would indeed be an especially high tax rate on them, that could be described as confiscatory. That's because they're pre-tax, i.e. worth much less than face value.
It might be possible to escape a wealth tax by cashing out an IRA and paying ordinary income taxes on it, if you're close to a threshold. Who knows where they'll put the threshold though. A number like $2 million would potentially catch many ordinary savers, especially if home value is not excluded. It would be a killer for many small business owners for sure. Not to mention that the cost of getting an annual business appraisal would be astronomical.
Re: Ira confiscation?
Posted: Mon May 24, 2021 11:43 am
by I Shrugged
WiseOne wrote: ↑Mon May 24, 2021 9:56 am
Yes there is a way to confiscate IRA accounts: include them as assets for a wealth tax. Anyone know where that bit of legislation stands?
Inclusion of IRAs in the asset calculation would indeed be an especially high tax rate on them, that could be described as confiscatory. That's because they're pre-tax, i.e. worth much less than face value.
It might be possible to escape a wealth tax by cashing out an IRA and paying ordinary income taxes on it, if you're close to a threshold. Who knows where they'll put the threshold though. A number like $2 million would potentially catch many ordinary savers, especially if home value is not excluded. It would be a killer for many small business owners for sure. Not to mention that the cost of getting an annual business appraisal would be astronomical.
I think (hope) a wealth tax will require a constitutional amendment. Anyway, if a wealth tax, or a tax on unrealized gains inside and/or outside of an estate happen, we will have turned a really significant corner in the US.
Re: Ira confiscation?
Posted: Mon May 24, 2021 12:37 pm
by GT
murphy_p_t wrote: ↑Sat May 22, 2021 8:56 pm
In light of the debt of the US federal government and the direction of politics, is a government takeover of ira accounts on the horizon?
I thought this was a good article with insightful comments. I think the risk might be greater than the author suggests in his article, however.
https://cashmoneylife.com/can-the-us-go ... 1k-or-ira/
Seems like it would be easier for the Gov to just print more money in the short term
I could see the Gov reviewing your retirement accounts to determine if you "have enough" then reduce or eliminate your SSA benefit (an equity in retirement law) -
Re: Ira confiscation?
Posted: Mon May 24, 2021 3:57 pm
by jhogue
The US government already practices double taxation on Social Security payments, so I think we have already moved in that direction.
Re: Ira confiscation?
Posted: Wed May 26, 2021 6:23 pm
by jalanlong
I’ve always seen this as a distinct possibility. I actually thought Obama’s MyRa program was going to be the beginning but Trump shut it down.
I fear a takeover of 401k plans. At some point when we have a really, really bad market crash with an Enron or two thrown in, the government will say we cannot trust our retirement to greedy corporations who are not looking out for us. We instead need to have them manage it. This would solve social security insolvency issues. I think right now there would be a decent amount of Americans that would go for it, much less the number that would support it after a market crash.