Saturday, January 24, 2015

Let the kids Pay Their Fair Share

The president's latest brainstorm is to make chumps out of all those who save money for their children's education.

As a junior senator in 2007, Mr Obama socked away $240,000 for his daughters' future college expenses in a 529 plan, by which interest and dividends accumulate tax free if used to pay tuition and related expenses. Good for him! At least Malia and Natasha won't be grabbing off scholarships that might go to less privileged students.

But now Mr Obama has had a change of heart: no, wait!, let's TAX those 529 earnings! So those not rich enough to front-load their 529 plan, as he did, will now see their kids taxed on the money they withdraw. The tax won't be retroactive, of course, so his own 529 accounts are protected from the ObamaTax.

Even more astonishing, last month the president signed the ABLE action, which authorizes a 529 for any disabled kidswho can't attend a conventional college. So what he gave in December he wants to take away in January: let the little rascals Pay Their Fair Share!

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