Bingo, give the man a prize. Once you establish the principle that your money is our money, it all falls into place. The fact is, you cannot finance the modern welfare state the democrats want just by income taxes. The rates would be so high that no one would work. So they have to come up with new sources of revenue. Obamacare made a start with numerous annoying additional taxes on things like cap gains, if you make over $250k. The big goal is a national sales tax or VAT. And of course, ditching all the deductions that people have planned their financial lives around. The republicans are trying to help raise taxes. They have already volunteered to get rid of unspecified deductions. The only ones that have any real money are very popular, so the republicans are proposing to ditch popular deductions and in exchange want cuts in medicare. That is really such a dumb posture you wonder if they even want to win elections.
Yes, they will actually get less revenue with higher taxes on the rich. My guess is there will be an additional punitive tax on properties above a certain value like in many European countries, it's quite hard to escape if they whack it on real estate.
"...The main reason I didn't convert to a Roth is that I think they will eventually have a "wealth tax".....nothing will be spared, including Roth's..." While it's logical to suspect, you don't KNOW that. And while it's true, "government can change the rules on us any time they want".. What we do know RIGHT NOW: 1. Tax rates likely to go up for 2013 and beyond.... so converting to a Roth later will be more expensive, tax-wise. 2. If your investing experience if favorable, having a "tax-free-for-life" asset of significant size is very hard to come by and very valuable.
You may be right. And its true, I don't know for sure they will tax them. But let me remind you, Social Security benefits used to be tax free.
No, not at all. Any cash distributions greater than cost basis are taxed as ordinary income... and in 2013, subject to the "Odumbocare 3.8% investment surtax".