Are Keoghs a good deal?

Asked December 22, 2013, 12:21 PM EST

So all the proceeds of a Keogh when distributed are treated as common income by the Government and taxed as such often at a bracket, which at the final distribution date, might be higher than when you "sheltered". You are not allowed to deduct stock losses "intramurally"along the way from one year to another. The Government never shares risk with you, but if you were lucky or smart over the long haul and did well -such as trippling your fund assets- the sheltered amounts and the CAPITAL GAINS are then hit as common income at the end. They shelter your investments at the start.... to hit you full force on everything at the end- on contributions as well as capital gains- without ever sharing risk. You were just sort of an "unpaid financial advisor" for the government. Besides, I understand that your devolved SS checks- now calomnied as an "entitlement"- are taxed higher if you distribute beyond a certain level at the end, even if it were for distressed circumstances . Are Keoghs a fair deal?

Bronx County New York personal finance

1 Response

Keogh plans, like IRAs and 401(k) plans, are a type of tax-deferred retirement savings vehicle. Keogh plans are available for self-employed people. Taxes on plan earnings are due when funds are withdrawn, typically in retirement. For more information on Keogh plans, see http://www.extension.org/pages/9664/investing-unit-7:-retirement-plans#.UsVc802A2M8