Pres. Obama proposes limits on IRAs for the rich

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NEW YORK (CNNMoney) — President Obama on Wednesday announced a plan that would prohibit individuals from reaping tax advantages on IRAs and other tax-preferred retirement accounts when funds exceed $3 million.

By proposing the cap as part of his 2014 budget, Obama is taking aim at those who stash many millions of dollars in tax-advantaged retirement accounts — which it argues is more than enough to retire comfortably.

A $3 million balance in a tax-preferred account like an IRA would currently allow a saver to finance an annuity of $205,000 per year in retirement. Removing the tax advantages for funds exceeding that threshold would save the government an estimated $9 billion over a decade, the budget estimates.

Based on the $3 million cap, less than 0.1% of IRA and 401(k) savers would be impacted, according to analysis from the Employee Benefit Research Institute. About 0.03%, or 6,180, of the 20.6…

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