During 2008 hearings on proposals to confiscate tax-differed personal retirement accounts such as 401(k)s and IRAs were held by Democrats in the U.S. House of Representatives. The focus was on confiscating them so the accounts would be managed by the Social Security Administration (SSA) instead of by the individuals who presently own those accounts.
During those hearings late in October Teresa Ghilarducci, professor of economic analysis at the New School for Social Research proposed to the House Committee on Education and Labor that the government eliminate tax breaks for retirement accounts and confiscate savings such as IRAs and other retirement plans and convert them to universal Guaranteed Retirement Accounts (GRAs) under the control of SSA.
According to an explanation in the Carolina Journal Online current plans, such as 401(k)s lets Americans invest pretax money and for their employers to match up to a defined percentage. This not only increases workers’ retirement savings but also reduces their annual income tax.
The balances are fully inheritable, subject to income tax, meaning workers can pass on the money in their savings accounts to their heirs. Even when they change jobs, going on to one that doesn't offer a 401(k) or pension, workers are allowed to transfer their balances to a qualified IRA.
In an update published by American Thinker.com on February 22, 2013, “The Feds Wants Your Retirement Accounts” reveals that “the groundwork is being laid for federal government confiscation tax-deferred retirement accounts such as IRAs. Under the plan the money accumulated would no longer be part of their estate when they die.
The confiscation by the government would mean that upon the death of a retirement account holder, the government would get the money, not the estate or the family of the working person who has accumulated the savings.