Trump made the worthless and empty promise that his tax plan would not gut the ability of Americans to save for retirement by capping the amount that can be placed in a 401(k).
The President tweeted:
There will be NO change to your 401(k). This has always been a great and popular middle class tax break that works, and it stays!
— Donald J. Trump (@realDonaldTrump) October 23, 2017
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That’s not what the proposed tax plan would do.
According to The Wall Street Journal, “Lobbyists and others in the retirement and financial-services industries who have spoken to congressional staff and committee members say lawmakers are looking at proposals that would allow 401(k) participants to contribute significantly less before taxes than what is currently allowed in a traditional tax-deferred 401(k). An often mentioned amount is $2,400 a year. It isn’t clear whether that would apply only to 401(k)s or IRAs or both.”
Republicans and Trump claim that the tax plan will be passed before the end of the year, but there is still no bill, and significant disagreements exist between Republicans. The state and local tax deductions have turned into a quagmire that could sink any bill, and the fight over capping 401(k) deductions also has the potential to destroy any legislation.
The problem is one that Republicans have faced for decades. The GOP wants to cut taxes for the wealthy but doesn’t want to pay for it.
Americans already don’t save enough for retirement. Only one-third of workers save to a 401(k). Congress and the President should be looking at laws to make it easier to save for retirement, not fighting over the preservation of tax breaks that are inadequate.
Trump’s promises are worthless. If the President tweets that retirement accounts are safe, it is safe to presume that they are under attack and your ability to save without taxation may soon vanish.
Jason is the managing editor. He is also a White House Press Pool and a Congressional correspondent for PoliticusUSA. Jason has a Bachelor’s Degree in Political Science. His graduate work focused on public policy, with a specialization in social reform movements.
Awards and Professional Memberships
Member of the Society of Professional Journalists and The American Political Science Association
