Obama’s ‘New Redistribution Plan’

President Obama wants everyone to have two “free” years of junior college. In his recent “State of the Union,” address he laid out new tax packages that includes a $320 billion hike to help pay for this plan.

Under current law, 529-Plans work like Roth IRAs — you put money in, and the money grows tax-free for college. Distributions are tax-free provided they are to pay for college.

But here’s what Obama didn’t say in plain, understandable language…

Under the Obama plan, earnings from a 529-Plan will no longer be tax-free. Instead, earnings would be taxed upon withdrawal, even if the withdrawal is to pay for college.

In addition to taxing college savings plans, Obama is calling for a hike in capital gains taxes, an increase in the death tax, a bank tax and an increase in retirement plan taxes. Each of his proposals will affect the middle class either directly or somewhere down the road.

This is nothing more than a ‘redistribution of wealth’ plan as those who’ve been saving and planning ahead for college will foot the bill for those who didn’t.

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About Tom Darby

French-born, American-raised, U.S. citizen, husband, father, friend, veteran, and writer.
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