Monday, January 26, 2015
Taxing the interest on 529 plans.
The latest war on the middle class comes with the taxing of 529 college savings plans – which currently grow tax-free. They are very popular among middle-class families who are trying to responsibly save for their children’s college tuition.
The White House has proposed taxing these plans as a way to “simplify the tax code.
More than 7 million families have saved money in 529 savings plans, believing that the future earnings on those plans would not be taxed and that they would receive tax cuts in their respective states. Obama’s proposal would directly hurt these families by taxing their savings as income, when they are already sacrificing to save.
What will the new tax be used for?
Paying for 2 years of community college. How does this make any sense. We encourage people to responsibly save for their children's education and then tax the increase in value of the savings that they would use to pay for their child's college to pay for someone else to send their child to college for free.
I guess if you can save your wealthy enough to pay a tax for those that don't save. Are politicians sending the wrong message to America. Spend today, we will help you tomorrow?
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Even if the proposal goes nowhere, which is likely , it could shape future higher education policy. And that’s alarming. A truly bad idea.
ReplyDeleteOutside of there is no way to pay for it, imagine the new facilities that would need to be built to accommodate millions of students currently not attending. Who would pay for the new facilities? The staff?
DeleteWould current 4 year colleges become year 3/4 colleges as they lose students to the FREE program?
We have one of the best community colleges in the country here in Monmouth County NJ, called Brookdale. They already promote Rutgers level courses that transfer and their credit rates are very low. Student enrollment has been decreasing and they have been forced to cut staff and budgets. I think the entire "education bubble" is slowly being deflated before our eyes.
DeleteOf course his proposal is going nowhere and he and his people know it. It's more smoke and mirrors by the "great campaigner." Everything he does is for show. Nothing will pass. He knows it. Schumer has kicked him under the bus on Obamacare, as has Menedez on Cuba and Iran. Holder and his band have made a mess out of the Ferguson matter. Northeast democrats are scared s___less about the loss of Jewish voters. He's been a lame duck since 2010. History will not be kind to our golfer in chief.