The Levin article is long overdue. At last, here is someone who calls it like it is, after the deluge of myths and misinformation that we have been fed. Obviously, this is a very complex matter and in this brief article, Levin could only touch on the unfairness and the myths of this tax bill and how it will affect the average American.
Unfortunately, one of the most unfair, if not cruel, aspects of this improperly named "tax reform bill" has not been mentioned by Levin. This is the reported elimination of the present law on lump sum distributions of profit-sharing or savings plan funds. This is the so-called "Special Ten-Year Averaging Method for Total Distribution from Qualified Retirement Plan--Form 4972."
Ever since 1967, some corporations, in lieu of raises or cash bonuses, have established such funds where they contributed for their employees, and kept them in trust. These funds were to be taxed in 10, 20 or more years upon retirement or termination, and the law allows these earnings to be taxed as if earned over a 10-year period. Since in most cases, earnings were accumulated over longer than 10 years, this was not a true concession by the Internal Revenue Service.