Tag: 401k
One of the major selling points for 401(k) plans has been their tax-preferred treatment under the federal personal income tax. But the value of the tax preference depends crucially on the tax treatment of investments outside of 401(k)s. And the taxation of capital gains and dividends has been reduced dramatically – particularly by the Bus…
Contributions to 401(k) plans are treated favorably under the federal personal income tax. The government does not tax either the employee or employer contributions to these plans or the investment earnings on the contributions until the monies are withdrawn in retirement. In addition, deferral shifts income to a time of life when people have less…
