Comment

Here's the Big Problem With Liberals' 'Middle Class' Agenda

4
SoCaroLion2/04/2015 11:49:41 am PST

Lumberhead (or New York Times article):

Are individuals and married couples making more than $150,000 per year more easily able to contribute to and compile savings in 529 plans? I suppose.

On the other hand, it is inappropriate for the NYT (and you, by extension) to assume that two entities earning $150,000 or more - one living in Greenwich Village (for example) and the other living in Binghamton, NY - share similar monthly expenses.

Therefore, whether or not “529 users are doing quite well for themselves” is generally irrelevant, primarily because virtually anyone (i.e. any adult with a pulse) is eligible to take advantage of the tax benefits of a 529 savings plan.

Here’s a tax credit solution: Considering that the vast majority of Federal income taxes are collected from the top third of taxpayers, give every taxpayer with children in the bottom two-thirds the option to divert a portion, if not all of their yearly Federal tax income contribution to a 529 savings plan. Then tax it at a very modest rate, maybe 0.5%, when it is withdrawn for college. Now that would help the ‘middle class.’