RE: "Workers aged 54 and younger could set aside 4 percentage points of their 12.4 percent Social Security payroll tax for private accounts that they and their heirs would keep forever."
For people in my generation, they would prefer this.
RE: "raising the $87,900 income limit subject to the payroll tax by an unspecified amount. Boosting it to $200,000 will completely pay for transitional costs in 10 years"
Never understood the logic as to why my FICA tax stopped once it had reached a certain max limit. As far as I'm concerned, it's perfectly acceptable to remove the FICA cap. It'll negatively impact me, but I always thought it was very unfair to tax the poor person a FICA tax throughout his or her entire year, while people like me get taxed for only a portion of the year.
If they allow you to save 4% of all your gross (including the amount exceeding $87,900), I see no reason why they can't remove the FICA tax cap and tax the entire gross. But if they cap the 4% savings to $87,900 while taxing the entire gross, that would be inconsistent - so the two should be consistent: meaning they tax us on our entire gross, and they allow us to save 4% of our entire gross (even if it goes beyond $87,900).
And if it pays for the transition cost in 10 years, that certainly sounds like a winner to me.
I think it's an excellent compromise.
Regards,
Amy J |
