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Comment by UncleMeat | Hacker News Reader

You've already won then. Why complain?

What's wrong with winning? Why not let people keep winning?

Because Bitcoin is a negative-sum enterprise. For the average speculator, total number of dollars out will be less than the total number of dollars in. That's exactly the opposite of what we want people to be doing with tax-advantaged retirement accounts.

What's wrong with paying taxes when you're winning?

Nothing. You still pay taxes on withdrawals from a traditional IRA.

So why not just invest in Bitcoin outside of your tax-advantaged accounts?

Why not invest inside of your tax-advantaged accounts as well?

The purpose of tax advantaged retirement accounts is to reduce the number of destitute people in retirement. It achieves this goal by providing a tax incentive on regular investment for people who would not otherwise invest.

If you won the lottery on crypto then you aren't going to be destitute in retirement. Pay the capital gains and enjoy your wealth.

Similarly, if you are a high earner and can afford to take advantage of things like the megabackdoor then you aren't going to be destitute in retirement. Pay the capital gains and enjoy your wealth.

> The purpose of tax advantaged retirement accounts is to reduce the number of destitute people in retirement. It achieves this goal by providing a tax incentive on regular investment for people who would not otherwise invest.

The purpose of tax advantage retirement accounts when originally introduced by ERISA was to give employees of private companies a safety net in cases where their pension defaulted or when a pension wasn't offered in the first place. There's really no mention of it being specifically for people who are destitute or would not otherwise invest. Traditional IRAs are available for everyone, even high earners, no gatekeeping.

> Pay the capital gains and enjoy your wealth.

Traditional IRAs are taxed on withdrawal and function much like other investments.

If there is no benefit to the IRA, then why are you upset?

Tax breaks exist to promote prosocial behavior. Getting people who are struggling to be able to afford to save for retirement is good for society. Giving people who made it big with a lucky gamble a benefit is just good for that individual.

In this case it's good for the individual without being detrimental to society.

Why have taxes at all, if this is your argument?

Because he feels that it's wrong that he made a lot of money doing something that other middle income earners could reasonably do, but now the ladder is getting pulled up behind him?

This is no skin off the back of the wealthy. They'll find another trick and life will go on. For those of them that actually care about "normal" Americans being able to do the same thing they did, it feels a little wrong that it requires an ever increasing amount moving parts and money to do what they did.

> This is no skin off the back of the wealthy

it is overly simplistic in USA - real people lose their "wealthy" status every day. You think a "wealthy" restaurant or bar owner is having a good day in 2021?

this class-baiting comes from the previous century, and IMO detracts from real problems right now

"Wealthy" in the context of most of the discussion surrounding this change are those with millions or billions in Roth IRAs. Those people's accountants will figure out a new strategy where they might have to pay a negligible amount in tax (if any at all). This change will be a few weeks of headache before it's largely forgotten. The only thing this will do for a struggling restaurant or bar owner in 2021 is ensure that they can't use money from their IRA to support their business.

I don't entirely understand what you're construing as class baiting. You don't have to have any contempt for the incredibly wealthy to acknowledge that they're going to walk away from this with extremely minimal losses, while your average person with a Roth IRA account won't be able to use it for starting or supporting their own business.

I’d like others to win.

You know that some people care about how policies affect people other than themselves, right? They may even care about society as a whole.

I really don't see how enabling people to make wild fortunes in tax advantaged accounts if they get lucky in cryptocurrency is good for society as whole.

The default is taxable accounts. Things like IRAs and 401ks are exceptions carved out to encourage the population to invest so that they don't end up eating cat food at age 80. People building huge fortunes in their IRAs isn't achieving this goal.

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