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Mon Jan 25, 2021, 03:29 PM

President Biden's Proposed Changes to 401(k) Plans

I have a few comments and concerns about this.


Did Biden campaign on this idea? This came as a surprise. I believe it will be more or less a wash for me personally.

So if you are in the 32% tax bracket or above ($164,901 in income for an individual), it can increase your taxes. I'm a bit concerned that the Republicans could construe this as a broken campaign promise ( "Nobody making under 400,000 bucks would have their taxes raised, period, bingo." ) I guess this then becomes a debate over semantics. Really it is restricting a tax haven a bit. Is restricting a tax haven considered raising taxes? Hmm.

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Reply President Biden's Proposed Changes to 401(k) Plans (Original post)
Shermann Jan 2021 OP
KayF Jan 2021 #1
Shermann Jan 2021 #2

Response to Shermann (Original post)

Mon Jan 25, 2021, 03:37 PM

1. the answer is yes

he did campaign on this, and then he won the election. The people have spoken.


Biden’s plan has few details, but the most important one is clear: He would “equalize the benefit across the income scale so working families also receive a substantial tax benefit when they put money away for retirement.” This would probably lead to about a 26% credit on every dollar any worker saved for retirement. (That estimate assumes Biden’s plan would not change the total amount of the tax incentive to save in a retirement plan, just the way the tax benefit is distributed.)

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Response to KayF (Reply #1)

Mon Jan 25, 2021, 03:46 PM

2. OK not a total surprise then

I'm still breaking down the numbers but so far support the proposal. It incentivizes lower income groups to save more for retirement and provides a partial contribution match.

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