One of the most attractive features of the Roth – the ability to avoid Required Minimum Distributions (“RMDs”) – is under attack by the Obama White House.

Under the clever euphemism of “harmonizing Roth RMD rules with other retirement accounts” President Obama’s fiscal 2015 budget calls for a provision that would require Roth IRAs to follow the same RMD rules as other retirement accounts.  Put another way Roth IRA owners would be required to take RMDs beginning at age 70 ½ as is the case with traditional IRAs, SEP-IRAs, etc.

There’s only one problem – how can Roth RMD rules be harmonized when Roths do not currently have RMDs?  One of the major reasons IRA owners converted to Roths is the fact that Roths do not have RMDs!

Should the proposal become law conversions would make sense for far fewer people.  Equally if not more so this proposal gives all those who haven’t made Roth conversions because they “don’t trust the government to keep their word” a sense of righteousness.  And the government wants us to trust them?  How can we play the game if the rules keep changing?

Whether it’s as explicit as raising tax rates or “hidden” like curbing deductions there’s nothing The Orator in Chief won’t do to punish success.  Someday – and hopefully that day is before it’s too late – our so-called leaders in Washington will heed Margaret Thatcher’s call:  “The problem with socialism is that you eventually run out of other people’s money.”