08 September 2005
Sustaining Social Security and Medicare
Why not end taxation of withdrawals from IRAs and other investments for special health needs, education, etc. ? If one has had the foresight and discipline to build a nest egg in anticipation of the time when work no longer provides an income for daily living?
Today, all distributions from various IRA's are taxed as Current Income. The government's rationale is that the money saved and earned by a retirement account, including any matching contributions from employers, is considered "tax deferred" unless the individual pays into the IRA after paying income tax.
I propose the following alternatives:
1. Designate all taxes collected from distributions of IRA savings for underwriting Social Security and Medicare, never into General Revenues available for allocations for the Annual Budget proposed by the President and as approved by Congress.
2. Eliminate short-term borrowing of cash revenues from the Social Security and Medicare trust accounts for the needs of other governmental functions. If such a loan is unavoidable, then it must be approved by Congress and signed by the President for a specific amount and repayment date.
3. For current revenues in excess of expenditures of Social Security and Medicare, consider a special distribution to the states for Medicaid costs. In addition, a small amount of the excess should fund the coming year's programs or be distributed to the Veterans Administration for its financial support and health care programs.
Our representatives in Congress should hear these and other suggestions about preserving and extending the financial foundation of Social Security and Medicare.
Post a Comment
Today, all distributions from various IRA's are taxed as Current Income. The government's rationale is that the money saved and earned by a retirement account, including any matching contributions from employers, is considered "tax deferred" unless the individual pays into the IRA after paying income tax.
I propose the following alternatives:
1. Designate all taxes collected from distributions of IRA savings for underwriting Social Security and Medicare, never into General Revenues available for allocations for the Annual Budget proposed by the President and as approved by Congress.
2. Eliminate short-term borrowing of cash revenues from the Social Security and Medicare trust accounts for the needs of other governmental functions. If such a loan is unavoidable, then it must be approved by Congress and signed by the President for a specific amount and repayment date.
3. For current revenues in excess of expenditures of Social Security and Medicare, consider a special distribution to the states for Medicaid costs. In addition, a small amount of the excess should fund the coming year's programs or be distributed to the Veterans Administration for its financial support and health care programs.
Our representatives in Congress should hear these and other suggestions about preserving and extending the financial foundation of Social Security and Medicare.
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