Time travel is a classic movie staple, to the point where you can hardly venture into your neighborhood metroplex without seeing someone in a rush to get to the past or the future. In The Terminator, Skynet sent a Cyberdine Systems Model 101 (aka the T-800, aka Arnold Schwarzenegger) into the past to kill John Connor’s mother. In Back to the Future Part II, Marty McFly drives his DeLorean 30 years ahead to save his son from sabotaging his family’s future. And in Avengers: Endgame, the gang goes back to 2012 New York to steal the Time Stone, Mind Stone, and Space Stone to keep Thanos from snapping his finger and exterminating half of all life in the universe.

So, if, say, Matt Damon starred in a movie about crime fighters chasing a villain for stealing from her future self, you’d probably show up, right? Well, you don’t have to pay $20 for a movie ticket and navigate sticky theater floors to see it. Just follow the case of former Baltimore City prosecutor Marilyn Mosby!

In Act I, Mosby earned headlines by prosecuting six police officers involved in the 2015 death of Freddie Gray, who died after getting a “rough ride” with no seatbelt in the back of a Baltimore paddy wagon. (Three of the officers were acquitted, which prompted her to drop charges against the other three.) At the same time, she was contributing to the City’s 457 plan, which is essentially a 401(k) for municipal workers. Those plans let employees defer the tax retirement contributions until they take the money out of the plan. However, plan rules generally give employees an escape hatch called a “hardship withdrawal” in case of “immediate and heavy need.”

In Act II, COVID swept the country, and Congress loosened the hardship withdrawal rules to accommodate “adverse financial consequences” tied to the pandemic. Mosby requested two withdrawals totaling $90,000 from her account. Just months later, she bought two vacation homes she planned to rent out in Florida.

In Act III, federal prosecutors discovered Mosby had misrepresented her circumstances when she took the withdrawals. (Uh oh.) She was earning nearly $250,000 at the time, with no interruption from the pandemic. And while she told investigators she had used the money to try and save a business organizing retreats for successful Black women, an FBI accountant found the business never had any clients or revenue, meaning Mosby couldn’t have suffered a loss of income.

Prosecutors indicted Mosby on two counts of perjury for falsely claiming financial hardship, along with two counts of mortgage fraud. Last November, a jury convicted her on the perjury charges. And last month, federal judge Lydia Kay Grigsby sentenced Mosby to three years of supervised release with 12 months of home confinement. She also had to forfeit one of the properties she bought with funds from a fraudulent application.

Bottom line: Mosby committed fraud, against her future self. That may sound melodramatic in a movie trailer. But should she really be facing punishment for it?

Ironically, locking money up in a retirement plan often isn’t worth the dopamine hit of today’s deduction. You’re gambling that the tax you’ll pay tomorrow is lower than the tax you’ll save today, which is far from certain in our current era of trillion-dollar deficits. In many cases, paying the tax now and putting the money in a tax-free environment is the better choice. You can do that with Roth IRA and retirement accounts. Or you can do it without the usual Roth restrictions, in a cash-value life insurance policy. So call us when you’re ready to save, and let us help you craft a tax-smart plan with no indictments!