Last Saturday I entered a post which leveled criticism at Obamacare on several fronts. One liberal reader was not happy with this and I can only assume that he reads this blog because he enjoys self-flagellation. Anyway, he challenged me for specifics and I love confounding liberals even though the task of analyzing the thousands of pages of legislative gobbledygook of HB3200 is a daunting one.
But, as luck would have it, another reader forwarded me part of the text which follows and I was able to concentrate on the taxation implications of the legislation. Note that the writer has translated the “legalese” into language for normal mortals but on an otherwise sleepless night you can cross check to your heart’s desire.
Page 50/section 152: The bill will provide insurance to all non-U.S. residents, even if they are here illegally.
Page 58 and 59: The government will have real-time access to an individual's bank account and will have the authority to make electronic fund transfers from those accounts.
Page 65/section 164: The plan will be subsidized (by the government) for all union members, union retirees and for community organizations (such as the Association of Community Organizations for Reform Now - ACORN).
Page 203/line 14-15: The tax imposed under this section will not be treated as a tax. (How could anybody in their right mind come up with that?)
Page 241 and 253: Doctors will all be paid the same regardless of specialty, and the government will set all doctors' fees.
Page 272. section 1145: Cancer hospitals will ration care according to the patient's age.
Page 317 and 321: The government will impose a prohibition on hospital expansion; however, communities may petition for an exception.
Page 425, line 4-12: The government mandates advance-care planning consultations. Those on Social Security will be required to attend an "end-of-life planning" seminar every five years. (Death counseling..)
Page 429, line 13-25: The government will specify which doctors can write an end-of-life order.
And here are some of the new ways we pay for all of this via tax hikes included in H.R. 3962, the revised House version of Obamacare, otherwise known as "The Affordable Health Care for America Act." The text of this bill runs to 1,990 pages, all of which can be read in pdf format. The page number references to each of the tax hikes noted below correspond to those in the pdf.
Page 275, Employer Mandate Excise Tax: If an employer does not pay 72.5 percent of a single employee’s health premium (65 percent of a family employee), the employer must pay an excise tax equal to 8 percent of average wages. Small employers (measured by payroll size) have smaller payroll tax rates of 0 percent (<$500,000), 2 percent ($500,000-$585,000), 4 percent ($585,000-$670,000), and 6 percent ($670,000-$750,000).
Page 296, Individual Mandate Surtax: If an individual fails to obtain qualifying coverage, he must pay an income surtax equal to the lesser of 2.5 percent of modified adjusted gross income (MAGI) or the average premium. MAGI adds back in the foreign earned income exclusion and municipal bond interest.
Page 324, Medicine Cabinet Tax: Non-prescription medications would no longer be able to be purchased from health savings accounts (HSAs), flexible spending accounts (FSAs), or health reimbursement arrangements (HRAs). Insulin excepted.
Page 325, Cap on FSAs: FSAs would face an annual cap of $2500 (currently uncapped).
Page 326, Increased Additional Tax on Non-Qualified HSA Distributions: Non-qualified distributions from HSAs would face an additional tax of 20 percent (current law is 10 percent). This disadvantages HSAs relative to other tax-free accounts (e.g. IRAs, 401(k)s, 529 plans, etc.)
Page 327, Denial of Tax Deduction for Employer Health Plans Coordinating with Medicare Part D: This would further erode private sector participation in delivery of Medicare services.
Page 336, Surtax on Individuals and Small Businesses: Imposes an income surtax of 5.4 percent on MAGI over $500,000 ($1 million married filing jointly). MAGI adds back in the itemized deduction for margin loan interest. This would raise the top marginal tax rate in 2011 from 39.6 percent under current law to 45 percent—a new effective top rate.
Page 339, Excise Tax on Medical Devices: Imposes a new excise tax on medical device manufacturers equal to 2.5 percent of the wholesale price. It excludes retail sales and unspecified medical devices sold to the general public.
Page 344, Corporate 1099-MISC Information Reporting: Requires that 1099-MISC forms be issued to corporations as well as persons for trade or business payments. Current law limits to just persons for small business compliance complexity reasons. Also expands reporting to exchanges of property.
Page 345, Delay in Worldwide Allocation of Interest: Delays for nine years the worldwide allocation of interest, a corporate tax relief provision from the American Jobs Creation Act
Page 346, Limitation on Tax Treaty Benefits for Certain Payments: Increases taxes on U.S. employers with overseas operations looking to avoid double taxation of earnings.
Page 349, Codification of the “Economic Substance Doctrine”: Empowers the IRS to disallow a perfectly legal tax deduction or other tax relief merely because the IRS deems that the motive of the taxpayer was not primarily business-related.
Page 357, Application of “More Likely Than Not” Rule: Publicly-traded partnerships and corporations with annual gross receipts in excess of $100 million have raised standards on penalties. If there is a tax underpayment by these taxpayers, they must be able to prove that the estimated tax paid would have more likely than not been sufficient to cover final tax liability.
Page 296, Individual Mandate Surtax: If an individual fails to obtain qualifying coverage, he must pay an income surtax equal to the lesser of 2.5 percent of modified adjusted gross income (MAGI) or the average premium. MAGI adds back in the foreign earned income exclusion and municipal bond interest.
Page 324, Medicine Cabinet Tax: Non-prescription medications would no longer be able to be purchased from health savings accounts (HSAs), flexible spending accounts (FSAs), or health reimbursement arrangements (HRAs). Insulin excepted.
Page 325, Cap on FSAs: FSAs would face an annual cap of $2500 (currently uncapped).
Page 326, Increased Additional Tax on Non-Qualified HSA Distributions: Non-qualified distributions from HSAs would face an additional tax of 20 percent (current law is 10 percent). This disadvantages HSAs relative to other tax-free accounts (e.g. IRAs, 401(k)s, 529 plans, etc.)
Page 327, Denial of Tax Deduction for Employer Health Plans Coordinating with Medicare Part D: This would further erode private sector participation in delivery of Medicare services.
Page 336, Surtax on Individuals and Small Businesses: Imposes an income surtax of 5.4 percent on MAGI over $500,000 ($1 million married filing jointly). MAGI adds back in the itemized deduction for margin loan interest. This would raise the top marginal tax rate in 2011 from 39.6 percent under current law to 45 percent—a new effective top rate.
Page 339, Excise Tax on Medical Devices: Imposes a new excise tax on medical device manufacturers equal to 2.5 percent of the wholesale price. It excludes retail sales and unspecified medical devices sold to the general public.
Page 344, Corporate 1099-MISC Information Reporting: Requires that 1099-MISC forms be issued to corporations as well as persons for trade or business payments. Current law limits to just persons for small business compliance complexity reasons. Also expands reporting to exchanges of property.
Page 345, Delay in Worldwide Allocation of Interest: Delays for nine years the worldwide allocation of interest, a corporate tax relief provision from the American Jobs Creation Act
Page 346, Limitation on Tax Treaty Benefits for Certain Payments: Increases taxes on U.S. employers with overseas operations looking to avoid double taxation of earnings.
Page 349, Codification of the “Economic Substance Doctrine”: Empowers the IRS to disallow a perfectly legal tax deduction or other tax relief merely because the IRS deems that the motive of the taxpayer was not primarily business-related.
Page 357, Application of “More Likely Than Not” Rule: Publicly-traded partnerships and corporations with annual gross receipts in excess of $100 million have raised standards on penalties. If there is a tax underpayment by these taxpayers, they must be able to prove that the estimated tax paid would have more likely than not been sufficient to cover final tax liability.
Specific enough for you?
No comments:
Post a Comment