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John Kartch

List of Upcoming Obamacare Tax Hikes


Posted by John Kartch on Tuesday, May 14th, 2013, 2:47 PM PERMALINK


The nation’s Capital is obsessed with the recent raft of IRS political scandals, crippling the little confidence the American people had in that agency. As the U.S. House prepares to vote on Obamacare repeal this week, taxpayers are reminded that some of the worst of the Obamacare tax increases begin to be implemented by the IRS this year and next:

Starting in tax year 2013:

Obamacare Flexible Spending Account Tax:  The 30 - 35 million Americans who use a pre-tax Flexible Spending Account (FSA) at work to pay for their family’s basic medical needs face a new Obamacare cap of $2,500. This will squeeze $13 billion of tax money from Americans over the next ten years. (Before Obamacare, the accounts were unlimited under federal law, though employers were allowed to set a cap.) Now, a parent looking to sock away extra money to pay for braces will find themselves quickly hitting this new cap, meaning they would have to pony up some or all of the cost with after-tax dollars. 

Needless to say, this tax will especially impact middle class families.

There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children.  Nationwide there are several million families with special needs children and many of them use FSAs to pay for special needs education. Tuition rates at one leading school that teaches special needs children in Washington, D.C. (National Child Research Center) can easily exceed $14,000 per year. Under tax rules, FSA dollars can be used to pay for this type of special needs education. This Obamacare tax provision will limit the options available to these families.

Obamacare High Medical Bills Tax: Before Obamacare, Americans facing high medical expenses were allowed a deduction to the extent that those expenses exceeded 7.5 percent of adjusted gross income (AGI).  Obamacare now imposes a threshold of 10 percent of AGI.  Therefore, Obamacare not only makes it more difficult to claim this deduction, it widens the net of taxable income.

According to the IRS, 10 million families took advantage of this tax deduction in 2009, the latest year of available data. Almost all are middle class. The average taxpayer claiming this deduction earned just over $53,000 annually. ATR estimates that the average income tax increase for the average family claiming this tax benefit will be $200 - $400 per year. To learn more about this tax, click here. 

Obamacare Medical Device Tax:  Medical device manufacturers employ 409,000 people in 12,000 plants across the country. Obamacare imposes a new 2.3 percent excise tax on gross sales – even if the company does not earn a profit in a given year.  In addition to killing small business jobs and impacting research and development budgets, this will make everything from pacemakers to artificial hips more expensive.

Obamacare Surtax on Investment Income:  A new, 3.8 percent surtax on investment income earned in households making at least $250,000 ($200,000 single). This tax hike results in the following top tax rates on investment income:

 

Capital Gains

Dividends

Other*

2013+

23.8%

43.4%

43.4%

*Other unearned income includes (for surtax purposes) gross income from interest, annuities, royalties, net rents, and passive income in partnerships and Subchapter-S corporations.  It does not include municipal bond interest or life insurance proceeds, since those do not add to gross income.  It does not include active trade or business income, fair market value sales of ownership in pass-through entities, or distributions from retirement plans. (Bill: Reconciliation Act; Page: 87-93)

Obamacare Medicare Payroll Tax Increase:

 

First $200,000
($250,000 Married)
Employer/Employee

All Remaining Wages
Employer/Employee

Pre-Obamacare

1.45%/1.45%
2.9% self-employed

1.45%/1.45%
2.9% self-employed

Obamacare

1.45%/1.45%
2.9% self-employed

1.45%/2.35%
3.8% self-employed

Starting in tax year 2014:

Obamacare Individual Mandate Non-Compliance Tax:  Starting in 2014, anyone not buying “qualifying” health insurance – as defined by President Obama’s Department of Health and Human Services -- must pay an income surtax to the IRS. The Congressional Budget Office recently estimated that six million American families will be liable for the tax, and as pointed out by the Associated Press:  “Most would be in the middle class.”

In addition, 100 percent of Americans filing a tax return (140 million filers) will be forced to submit paperwork to the IRS showing they either had “qualifying” health insurance for every month of the tax year or they obtained an exemption to the mandate.

Americans liable for the surtax will pay according to the following schedule:

 

1 Adult

2 Adults

3+ Adults

2014

1% AGI/$95

1% AGI/$190

1% AGI/$285

2015

2% AGI/$325

2% AGI/$650

2% AGI/$975

2016 +

2.5% AGI/$695

2.5% AGI/$1390

2.5% AGI/$2085

Obamacare Employer Mandate Tax:  If an employer does not offer health coverage, and at least one employee qualifies for a health tax credit, the employer must pay an additional non-deductible tax of $2,000 for all full-time employees.  This provision applies to all employers with 50 or more employees. If any employee actually receives coverage through the exchange, the penalty on the employer for that employee rises to $3,000. If the employer requires a waiting period to enroll in coverage of 30-60 days, there is a $400 tax per employee ($600 if the period is 60 days or longer).

Obamacare Tax on Health Insurers:  Annual tax on the industry imposed relative to health insurance premiums collected that year.  The tax phases in gradually until 2018.  Fully imposed on firms with $50 million in profits.

Starting in tax year 2018:

Obamacare Tax on Union Member and Early Retiree Health Insurance Plans:  Obamacare imposes a new 40 percent excise tax on high cost or “Cadillac” health insurance plans, effective in 2018. This tax increase will most directly affect union families and early retirees, who are likely to be covered by such plans. This Obamacare tax will be levied on insurance policies whose premiums exceed $10,200 for an individual and $27,500 for a family.  Middle class union members tend to be covered by such plans in states like Ohio, Pennsylvania, Wisconsin, and Michigan.  Higher threshold ($11,500 single/$29,450 family) for early retirees and high-risk professions. CPI +1 percentage point indexed.

View PDF here.

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Obamacare: Taxpayers Must Report Personal Health ID Info to IRS


Posted by John Kartch on Friday, May 10th, 2013, 2:46 PM PERMALINK


The new form will require disclosure of a taxpayer’s personal identifying health information in order to determine compliance with the Affordable Care Act’s individual mandate.

As confirmed by IRS testimony to the tax-writing House Committee on Ways and Means, “taxpayers will file their tax returns reporting their health insurance coverage, and/or making a payment”. 

So why will the Obama IRS require your personal identifying health information? 

Simply put, there is no way for the IRS to enforce Obamacare’s individual mandate without such an invasive reporting scheme.  Every January, health insurance companies across America will send out tax documents to each insured individual.  This tax document—a copy of which will be furnished to the IRS—must contain sufficient information for taxpayers to prove that they purchased qualifying health insurance under Obamacare.

This new tax information document must, at a minimum, contain: the name and health insurance identification number of the taxpayer; the name and tax identification number of the health insurance company; the number of months the taxpayer was covered by this insurance plan; and whether or not the plan was purchased in one of Obamacare’s “exchanges.”

This will involve millions of new tax documents landing in mailboxes across America every January, along with the usual raft of W-2s, 1099s, and 1098s.  At tax time, the 140 million families who file a tax return will have to get acquainted with a brand new tax filing form.  Six million of these families will end up paying Obamacare’s individual mandate non-compliance tax penalty.

As a service to the public, Americans for Tax Reform has released a projected version of this tax form to help families and tax specialists prepare for this additional filing requirement. Taxpayers may view the projected IRS form at www.ObamacareTaxForm.com.  On the form, lines 3-4 show where taxpayers will disclose their personal health ID information.

View PDF here.

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Happy Mother's Day: Obamacare's Tax War on Moms


Posted by John Kartch on Friday, May 10th, 2013, 12:42 PM PERMALINK


The President will undoubtedly forget to mention the 20 new or higher taxes in Obamacare, and the five that most hurt women:

1. Obamacare Flexible Spending Account Tax:  The 30 - 35 million Americans who use a pre-tax Flexible Spending Account (FSA) at work to pay for their family’s basic medical needs face a new Obamacare cap of $2,500. This will squeeze $13 billion of tax money from Americans over the next ten years. (Before Obamacare, the accounts were unlimited under federal law, though employers were allowed to set a cap.) Now, a parent looking to sock away extra money to pay for braces will find themselves quickly hitting this new cap, meaning they would have to pony up some or all of the cost with after-tax dollars. 

Needless to say, this tax will especially impact middle class families.

There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children.  Nationwide there are several million families with special needs children and many of them use FSAs to pay for special needs education. Tuition rates at one leading school that teaches special needs children in Washington, D.C. (National Child Research Center) can easily exceed $14,000 per year. Under tax rules, FSA dollars can be used to pay for this type of special needs education. This Obamacare tax provision will limit the options available to these families.  

2. Obamacare High Medical Bills Tax: Before Obamacare, Americans facing high medical expenses were allowed a deduction to the extent that those expenses exceeded 7.5 percent of adjusted gross income (AGI).  Obamacare now imposes a threshold of 10 percent of AGI.  Therefore, Obamacare not only makes it more difficult to claim this deduction, it widens the net of taxable income.

According to the IRS, 10 million families took advantage of this tax deduction in 2009, the latest year of available data. Almost all are middle class. The average taxpayer claiming this deduction earned just over $53,000 annually. ATR estimates that the average income tax increase for the average family claiming this tax benefit will be $200 - $400 per year. To learn more about this tax, click here. 

3. Medicine Cabinet Tax. This tax increase is already in effect. Since January of 2011, Americans have not been able to purchase non-prescription, over-the-counter medicines from their Flexible Spending Accounts or Health Savings Accounts. Women often rely on over-the-counter medicines to get themselves and their families through the colds, fevers, and aches and pains of daily family life. To raise taxes on busy Moms makes absolutely no sense.

4. Obamacare Individual Mandate Non-Compliance Tax:  Starting in 2014, anyone not buying “qualifying” health insurance – as defined by President Obama’s Department of Health and Human Services -- must pay an income surtax to the IRS. The Congressional Budget Office recently estimated that six million American families will be liable for the tax, and as pointed out by the Associated Press:  “Most would be in the middle class.”

In addition, 100 percent of Americans filing a tax return (140 million filers) will be forced to submit paperwork to the IRS showing they either had “qualifying” health insurance for every month of the tax year or they obtained an exemption to the mandate.

Americans liable for the surtax will pay according to the following schedule:

 

1 Adult

2 Adults

3+ Adults

2014

1% AGI/$95

1% AGI/$190

1% AGI/$285

2015

2% AGI/$325

2% AGI/$650

2% AGI/$975

2016 +

2.5% AGI/$695

2.5% AGI/$1390

2.5% AGI/$2085

5. Obamacare 10 Percent Excise Tax on Indoor Tanning: This Obamacare tax increase has the distinction of being the first to go into effect (July 2010). Slipped into the bill by Sen. Harry Reid (D-Nev.) behind closed doors in the middle of the night, this tax hike replaced the planned Obamacare “Botax” on cosmetic surgery.  This petty, burdensome, nanny-state tax affects both the business owner and the end user.  Industry estimates from the Indoor Tanning Association show that 30 million Americans visit an indoor tanning facility in a given year, and over 50 percent of salon owners are women.  There is no exception granted for those making less than $250,000 meaning it is yet another tax that violates Obama’s “firm pledge” not to raise “any form” of tax on Americans making less than this amount.

Making matters worse: According to a Treasury Inspector General for Tax Administration report, the Obama IRS didn’t bother to issue compliance guidelines until three quarterly filing deadlines had passed:  “By the time [IRS] notices were issued, tanning excise tax returns had been due for three quarters."  This is yet another sign that the Obama administration is ill-prepared for Obamacare implementation.

Click here for a printable PDF of this document

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Taxpayer Group to Sens. Fischer and Johanns: Vote No on Internet Sales Tax


Posted by John Kartch on Friday, May 3rd, 2013, 2:27 PM PERMALINK


In advance of a final U.S. Senate vote on Monday, Americans for Tax Reform (ATR) today sent an action alert to Nebraska taxpayers asking them to urge Sens. Deb Fischer and Mike Johanns to vote “No” on the “Marketplace Fairness Act.”  The Act is a $22 billion tax increase that would dramatically expand government tax authority, increase tax complexity, lead to further tax grabs, discourage tax competition among the states, and threaten privacy.
The text of the action alert is as follows:
          After an outpouring of opposition from taxpayers like you, senators are quickly learning how dangerous the Marketplace Fairness Act’s Internet sales tax would be for taxpayers and small businesses. Now is the time to send Senators Fischer and Johanns a clear message: Vote AGAINST the Marketplace Fairness Act!
          Take Action Now to urge Senators Fischer and Johanns to vote AGAINST an Internet sales tax that would line the pockets of the political elite in other states.
          For weeks, a group of tax-hungry senators has been quietly pushing legislation that would include an unprecedented Internet sales tax. Advocates of the so-called “Marketplace Fairness Act” assumed they would have broad support, but grassroots efforts have slowed down this $22 billion tax hike’s momentum.
          There is even more at stake here than the $22 billion that will be taken from taxpayers. The proposed legislation would threaten privacy, force small businesses to comply with thousands of local tax codes, and infringe on states’ rights.
          The choice is clear for senators who care about letting hardworking Americans keep more of what they earn. Contact Senators Fischer and Johanns immediately to let them know you OPPOSE an Internet sales tax.
          Another vote on the Marketplace Fairness Act is expected this Monday, May 6. Senators Fischer and Johanns need to be reminded that an Internet sales tax would be bad for you and the rest of Nebraska's taxpayers.
          We must keep the pressure on our senators before they vote on Monday. Take action now to prevent an Internet Sales Tax at www.taxeswithoutborders.com.

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Taxpayer Group to Sen. Moran: Vote No on Internet Sales Tax


Posted by John Kartch on Friday, May 3rd, 2013, 2:18 PM PERMALINK


In advance of a final U.S. Senate vote on Monday, Americans for Tax Reform (ATR) today sent an action alert to Kansas taxpayers asking them to urge Sen. Jerry Moran to vote “No” on the “Marketplace Fairness Act.”  The Act is a $22 billion tax increase that would dramatically expand government tax authority, increase tax complexity, lead to further tax grabs, discourage tax competition among the states, and threaten privacy.

The text of the action alert is as follows:

          After an outpouring of opposition from taxpayers like you, senators are quickly learning how dangerous the Marketplace Fairness Act’s Internet sales tax would be for taxpayers and small businesses. Now is the time to send Senator Moran a clear message: Vote AGAINST the Marketplace Fairness Act!

          Take Action Now to urge Senator Moran to vote AGAINST an Internet sales tax that would line the pockets of the political elite in other states.

          For weeks, a group of tax-hungry senators has been quietly pushing legislation that would include an unprecedented Internet sales tax. Advocates of the so-called “Marketplace Fairness Act” assumed they would have broad support, but grassroots efforts have slowed down this $22 billion tax hike’s momentum.

          There is even more at stake here than the $22 billion that will be taken from taxpayers. The proposed legislation would threaten privacy, force small businesses to comply with thousands of local tax codes, and infringe on states’ rights.

          The choice is clear for senators who care about letting hardworking Americans keep more of what they earn. Contact Senator Moran immediately to let him know you OPPOSE an Internet sales tax.

          Another vote on the Marketplace Fairness Act is expected this Monday, May 6. Senator Moran needs to be reminded that an Internet sales tax would be bad for you and the rest of Kansas' taxpayers.

          We must keep the pressure on our senators before they vote on Monday. Take action now to prevent an Internet Sales Tax at www.taxeswithoutborders.com.

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Taxpayer Group to Sen. Landrieu: Vote No on Internet Sales Tax


Posted by John Kartch on Friday, May 3rd, 2013, 2:08 PM PERMALINK


In advance of a final U.S. Senate vote on Monday, Americans for Tax Reform (ATR) today sent an action alert to Louisiana taxpayers asking them to urge Sen. Mary Landrieu to vote “No” on the “Marketplace Fairness Act.”  The Act is a $22 billion tax increase that would dramatically expand government tax authority, increase tax complexity, lead to further tax grabs, discourage tax competition among the states, and threaten privacy.

The text of the action alert is as follows:

          After an outpouring of opposition from taxpayers like you, senators are quickly learning how dangerous the Marketplace Fairness Act’s Internet sales tax would be for taxpayers and small businesses. Now is the time to send Senator Landrieu a clear message: Vote AGAINST the Marketplace Fairness Act!

          Take Action Now to urge Senator Landrieu to vote AGAINST an Internet sales tax that would line the pockets of the political elite in other states.

          For weeks, a group of tax-hungry senators has been quietly pushing legislation that would include an unprecedented Internet sales tax. Advocates of the so-called “Marketplace Fairness Act” assumed they would have broad support, but grassroots efforts have slowed down this $22 billion tax hike’s momentum.

          There is even more at stake here than the $22 billion that will be taken from taxpayers. The proposed legislation would threaten privacy, force small businesses to comply with thousands of local tax codes, and infringe on states’ rights.

          The choice is clear for senators who care about letting hardworking Americans keep more of what they earn. Contact Senator Landrieu immediately to let her know you OPPOSE an Internet sales tax.

          Another vote on the Marketplace Fairness Act is expected this Monday, May 6. Senator Landrieu needs to be reminded that an Internet sales tax would be bad for you and the rest of Louisiana's taxpayers.

          We must keep the pressure on our senators before they vote on Monday. Take action now to prevent an Internet Sales Tax at www.taxeswithoutborders.com.

More from Americans for Tax Reform

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Taxpayer Group to Sen. Graham: Vote No on Internet Sales Tax


Posted by John Kartch on Friday, May 3rd, 2013, 1:57 PM PERMALINK


In advance of a final U.S. Senate vote on Monday, Americans for Tax Reform (ATR) today sent an action alert to South Carolina taxpayers asking them to urge Sen. Lindsey Graham to vote “No” on the “Marketplace Fairness Act.”  The Act is a $22 billion tax increase that would dramatically expand government tax authority, increase tax complexity, lead to further tax grabs, discourage tax competition among the states, and threaten privacy.

The text of the action alert is as follows:

          After an outpouring of opposition from taxpayers like you, senators are quickly learning how dangerous the Marketplace Fairness Act’s Internet sales tax would be for taxpayers and small businesses. Now is the time to send Senator Graham a clear message: Vote AGAINST the Marketplace Fairness Act!

          Take Action Now to urge Senator Graham to vote AGAINST an Internet sales tax that would line the pockets of the political elite in other states.

          For weeks, a group of tax-hungry senators has been quietly pushing legislation that would include an unprecedented Internet sales tax. Advocates of the so-called “Marketplace Fairness Act” assumed they would have broad support, but grassroots efforts have slowed down this $22 billion tax hike’s momentum.

          There is even more at stake here than the $22 billion that will be taken from taxpayers. The proposed legislation would threaten privacy, force small businesses to comply with thousands of local tax codes, and infringe on states’ rights.

          The choice is clear for senators who care about letting hardworking Americans keep more of what they earn. Contact Senator Graham immediately to let him know you OPPOSE an Internet sales tax.

          Another vote on the Marketplace Fairness Act is expected this Monday, May 6. Senator Graham needs to be reminded that an Internet sales tax would be bad for you and the rest of South Carolina's taxpayers.

          We must keep the pressure on our senators before they vote on Monday. Take action now to prevent an Internet Sales Tax at www.taxeswithoutborders.com.

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Taxpayer Group to Sens. Chambliss and Isakson: Vote No on Internet Sales Tax


Posted by John Kartch on Friday, May 3rd, 2013, 1:33 PM PERMALINK


In advance of a final U.S. Senate vote on Monday, Americans for Tax Reform (ATR) today sent an action alert to Georgia taxpayers asking them to urge Sens. Saxby Chambliss and Johnny Isakson to vote “No” on the “Marketplace Fairness Act.”  The Act is a $22 billion tax increase that would dramatically expand government tax authority, increase tax complexity, lead to further tax grabs, discourage tax competition among the states, and threaten privacy.

The text of the action alert is as follows:

          After an outpouring of opposition from taxpayers like you, senators are quickly learning how dangerous the Marketplace Fairness Act’s Internet sales tax would be for taxpayers and small businesses. Now is the time to send Senators Chambliss and Isakson a clear message: Vote AGAINST the Marketplace Fairness Act!

          Take Action Now to urge Senators Chambliss and Isakson to vote AGAINST an Internet sales tax that would line the pockets of the political elite in other states.

          For weeks, a group of tax-hungry senators has been quietly pushing legislation that would include an unprecedented Internet sales tax. Advocates of the so-called “Marketplace Fairness Act” assumed they would have broad support, but grassroots efforts have slowed down this $22 billion tax hike’s momentum.

          There is even more at stake here than the $22 billion that will be taken from taxpayers. The proposed legislation would threaten privacy, force small businesses to comply with thousands of local tax codes, and infringe on states’ rights.

          The choice is clear for senators who care about letting hardworking Americans keep more of what they earn. Contact Senators Chambliss and Isakson immediately to let them know you OPPOSE an Internet sales tax.

          Another vote on the Marketplace Fairness Act is expected this Monday, May 6. Senators Chambliss and Isakson need to be reminded that an Internet sales tax would be bad for you and the rest of Georgia's taxpayers.

          We must keep the pressure on our senators before they vote on Monday. Take action now to prevent an Internet Sales Tax at www.taxeswithoutborders.com.

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Obamacare's Tax Hike Train Wreck


Posted by John Kartch on Tuesday, April 30th, 2013, 4:20 PM PERMALINK


Asked about Senator Max Baucus’s (D-Mont.) recent “train wreck” comments, President Obama today said, “A huge chunk of it [Obamacare] has already been implemented.” Unmentioned was the wave of destructive Obamacare tax increases that will begin to hit Americans during the next tax filing season and beyond:

Starting in tax year 2013:

Obamacare Surtax on Investment Income:  A new, 3.8 percent surtax on investment income earned in households making at least $250,000 ($200,000 single). This tax hike results in the following top tax rates on investment income:

  Capital Gains Dividends Other*
2013+ 23.8% 43.4% 43.4%

*Other unearned income includes (for surtax purposes) gross income from interest, annuities, royalties, net rents, and passive income in partnerships and Subchapter-S corporations.  It does not include municipal bond interest or life insurance proceeds, since those do not add to gross income.  It does not include active trade or business income, fair market value sales of ownership in pass-through entities, or distributions from retirement plans. (Bill: Reconciliation Act; Page: 87-93)

Obamacare Medicare Payroll Tax Increase:

 

First $200,000

($250,000 Married)

Employer/Employee

All Remaining Wages

Employer/Employee

 

Pre-Obamacare

1.45%/1.45%

2.9% self-employed

1.45%/1.45%

2.9% self employed

Obamacare

1.45%/1.45%

2.9% self-employed

1.45%/2.35%

3.8% self-employed


(Bill: PPACA, Reconciliation Act; Page: 2,000-2,003; 87-93)

Obamacare Medical Device Tax:  Medical device manufacturers employ 409,000 people in 12,000 plants across the country. Obamacare imposes a new 2.3 percent excise tax on gross sales – even if the company does not earn a profit in a given year.  In addition to killing small business jobs and impacting research and development budgets, this will make everything from pacemakers to artificial hips more expensive. (Bill: PPACA; Page: 1,980-1,986)

Obamacare High Medical Bills Tax: Before Obamacare, Americans facing high medical expenses were allowed a deduction to the extent that those expenses exceeded 7.5 percent of adjusted gross income (AGI).  Obamacare now imposes a threshold of 10 percent of AGI.  Therefore, Obamacare not only makes it more difficult to claim this deduction, it widens the net of taxable income. According to the IRS, 10 million families took advantage of this tax deduction in 2009, the latest year of available data. Almost all are middle class. The average taxpayer claiming this deduction earned just over $53,000 annually. ATR estimates that the average income tax increase for the average family claiming this tax benefit will be $200 - $400 per year. To learn more about this tax, click here.  (Bill: PPACA; Page: 1,994-1,995)

Obamacare Flexible Spending Account Tax:  The 30 - 35 million Americans who use a pre-tax Flexible Spending Account (FSA) at work to pay for their family’s basic medical needs face a new Obamacare cap of $2,500. This will squeeze $13 billion of tax money from Americans over the next ten years. (Before Obamacare, the accounts were unlimited under federal law, though employers were allowed to set a cap.) Now, a parent looking to sock away extra money to pay for braces will find themselves quickly hitting this new cap, meaning they would have to pony up some or all of the cost with after-tax dollars.

Needless to say, this tax will especially impact middle class families.

There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children. Nationwide there are several million families with special needs children and many of them use FSAs to pay for special needs education. Tuition rates at one leading school that teaches special needs children in Washington, D.C. (National Child Research Center) can easily exceed $14,000 per year. Under tax rules, FSA dollars can be used to pay for this type of special needs education. This Obamacare tax provision will limit the options available to these families. (Bill: PPACA; Page: 2,388-2,389)

Starting in tax year 2014:

Obamacare Individual Mandate Non-Compliance Tax:  Starting in 2014, anyone not buying “qualifying” health insurance – as defined by President Obama’s Department of Health and Human Services -- must pay an income surtax to the IRS. The Congressional Budget Office recently estimated that six million American families will be liable for the tax, and as pointed out by the Associated Press:  “Most would be in the middle class.”

In addition, 100 percent of Americans filing a tax return (140 million filers) will be forced to submit paperwork to the IRS showing they either had “qualifying” health insurance for every month of the tax year or they obtained an exemption to the mandate.

Americans liable for the surtax will pay according to the following schedule

  1 Adult 2 Adults 3+ Adults
2014 1%AGI/$95 1%AGI/$190 1%AGI/$285
2015 2%AGI/$325 2%AGI/$650 2%AGI/$975
2016 2.5%AGI/$695 2.5%AGI/$1390 2.5%AGI/$2085

(Bill: PPACA; Page: 317-337)

Obamacare Employer Mandate Tax:  If an employer does not offer health coverage, and at least one employee qualifies for a health tax credit, the employer must pay an additional non-deductible tax of $2,000 for all full-time employees.  This provision applies to all employers with 50 or more employees. If any employee actually receives coverage through the exchange, the penalty on the employer for that employee rises to $3,000. If the employer requires a waiting period to enroll in coverage of 30-60 days, there is a $400 tax per employee ($600 if the period is 60 days or longer). (Bill: PPACA; Page: 345-346)

Obamacare Tax on Health Insurers:  Annual tax on the industry imposed relative to health insurance premiums collected that year.  The tax phases in gradually until 2018.  Fully imposed on firms with $50 million in profits. (Bill: PPACA; Page: 1,986-1,993)

Starting in tax year 2018:

Obamacare Tax on Union Member and Early Retiree Health Insurance Plans:  Obamacare imposes a new 40 percent excise tax on high cost or “Cadillac” health insurance plans, effective in 2018. This tax increase will most directly affect union families and early retirees, who are likely to be covered by such plans. This Obamacare tax will be levied on insurance policies whose premiums exceed $10,200 for an individual and $27,500 for a family.  Middle class union members tend to be covered by such plans in states like Ohio, Pennsylvania, Wisconsin, and Michigan.  Higher threshold ($11,500 single/$29,450 family) for early retirees and high-risk professions. CPI +1 percentage point indexed. (Bill: PPACA; Page: 1,941-1,956)

Click here for a printable PDF

 

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Top Internet Tax Lobbyist Dismisses Constitution as "an 18th-century document"


Posted by John Kartch on Friday, April 26th, 2013, 1:54 PM PERMALINK


As published in the Wall Street Journal, David French, senior vice president of government relations for the National Retail Federation, a group lobbying for the Marketplace Fairness Act, said the following:

"The industry is evolving very rapidly, and the law today is a 20th-century interpretation of an 18th-century document that is holding back the entire retail industry as it adapts to 21st-century consumer preferences and demand," said David French, senior vice president for government affairs at the National Retail Federation, a retail-industry trade group lobbying for the legislation.

The Commerce Clause in the U.S. Constitution affirms that states cannot tax across their borders. Physical presence within a state’s boundaries is required for a state to be able to tax a business, a consumer, or a sale.  The Constitution is clear: a person or business must be physically present within a state’s borders in order to be taxed.  By suggesting the Constitution is outdated, Internet tax pushers align themselves with the rhetoric of far-left judicial activists.

Americans for Tax Reform has pointed out five reasons the Marketplace Fairness Act is bad for taxpayers:

Expands State Tax Authority: State governments will be able to tax across their borders despite clear legal and judicial precedent arguing otherwise.

Slippery Slope to More State Tax Grabs:  Opens the door for further government intervention in the Internet and for states to reach across their borders for other taxes.

Tax Complexity: Small businesses would be forced to accommodate over 9,000 highly variable state and local tax codes and be required to settle disputes with out-of-state revenue boards in out-of-state courts.

Discourages Tax Competition: Rather than competing to lower taxes and attract businesses, states will compete to raise taxes on residents of other states.

Threatens Privacy: Business and state revenue boards with a track record of losing private information will have more chances to do so.

(Feel free to share on Facebook and Pinterest!)

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