(Page numbers reference ORIGINAL REID-OBAMA BILL unless noted):

Individual Mandate Excise Tax (Page 324/Sec. 1501/Jan 2014*): Starting in 2014, anyone not buying “qualifying” health insurance must pay an income surtax according to the higher of the following (page 71 of manager’s amendment updates Reid bill):

 

 

	Single	2 People	3+ People
2014	$495/0.5% AGI	$990/0.5% AGI	$1485/0.5%/AGI
2015	$495/1.0% AGI	$990/1.0% AGI	$1485/1.0%/AGI
2016+	$495/2.0% AGI	$990/2.0% AGI	$1485/2.0%/AGI

 

Exemptions for religious objectors, undocumented immigrants, prisoners, those earning less than the poverty line, members of Indian tribes, and hardship cases (determined by HHS).

 

Employer Mandate Tax (Page 348/Sec. 1513/Jan 2014*):  Small business owners pay their business taxes on their personal 1040 forms.  This tax does not exempt startup small business owners even if they make less than $250,000. If the 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 $750 for all full-time employees.  Applies to all employers with 50 or more employees.

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).

Medicine Cabinet Tax (Page 1997/Sec. 9003/$5 bil/Jan 2011): Americans would no longer be able to use health savings account (HSA), flexible spending account (FSA), or health reimbursement (HRA) pre-tax dollars to purchase non-prescription, over-the-counter medicines (except insulin).

HSA Withdrawal Tax Hike (Page 1998/Sec. 9004/$1.3 bil/Jan 2011): Increases additional tax on non-medical early withdrawals from an HSA from 10 to 20 percent, disadvantaging them relative to IRAs and other tax-advantaged accounts, which remain at 10 percent.

Flexible Spending Account Cap – aka “Special Needs Kids Tax” (Page 1999/Sec. 9005/$14 bil/Jan 2011): Imposes cap on FSAs of $2500 (now unlimited).  Indexed to inflation after 2011 (added on page 363 of manager’s amendment). There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children.  There are thousands of families with special needs children in the United States, 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. 

Medical Itemized Deductions Cap (Page 2034/Sec. 9013/$15.2 bil/Jan 2013): Currently, those facing high medical expenses are allowed a deduction if the total cost of the expenses reduces the filer’s income by 7.5%. The new provision would impose a threshold of 10%. This new tax will most adversely affect early retirees and the catastrophically ill. Waived for 65+ taxpayers in 2013-2016 only.

Tax on Indoor Tanning Services (Page 373 of Manager’s amendment/$2.7 billion/July 1, 2010): New 10% excise tax on Americans using indoor tanning salons

 

* CBO Estimates That the Mandate Tax Penalties Will Raise $39 billion from 2010-2019

I'm a conservative and opposed to this reform, but this list has to be the dumbest list of things to be concerned about. If you're a middle-class family and you're worried that the tanning booth tax is going to impact your family budget, your priorities are seriously out of whack. Don't most small business owners incorporate their businesses? Filing your profits on your person 1040 isn't the shrewdest thing to do for numerous reason even before this reform. As someone who works hard to afford my personal coverage, I wouldn't mind those who assume the emergency room will service them if they don't have their own insurance to kick a little something into the kitty via a penalty tax. Otherwise I end up paying for indirectly anyway.
>> Broll The American Tuesday, March 23, 2010 1:15 PM Report Comment

I believe the point is not whether these items are right or wrong or even "things to be concerned about" on their face, but rather that each of these items breaks the President's "'firm pledge' not to raise 'any form' of taxes on families making less than $250,000 per year." Just to clarify...
>> In Response to Broll Tuesday, March 23, 2010 2:45 PM Report Comment

This comes to show that you cant trust anyone, especially the leader of our country, they are all liars and cheaters.
>> Cher Sawyer Wednesday, March 24, 2010 11:21 AM Report Comment

In response to Broll, no most small business owners do not incorporate. Most small businesses are LLCs or LLPs due to the individual state's incorporation requirements. It is easier & cheaper to go the LLC or LLP route than incorporation in most cases. This legislation is going to decimate small business. And it clearly shows Obama to be the liar every intelligent person thought he was during the campaign.
>> Gregg Wednesday, March 24, 2010 12:22 PM Report Comment

In response to Broll and Gregg, its quite cheap to incorporate and then file as an S-Corp. There are 2 ways to file for tax purposes either s-Corp or c-Corp. S-corps pay no federal corporate taxes instead the companies profits are passed to the shareholders who declare them on a 1040. If you file as a c-corp you will get double taxed, first on the corporate profits and then on the dividend payment to the shareholder.
>> David Wednesday, March 24, 2010 1:17 PM Report Comment

How can anyone oppose taxing people who make over $250,000/year...unless you make $250,000/year. And...pharmaceutical and insurance companies make HUGE, HUGE, profits off of people's illnesses. I think they should pay HIGHER taxes, in fact. Why does the CEO deserve multi-million dollar salaries? They really do not work harder than other people, in their cushy offices. It is just pure greed.
>> Someone not making 250,000 Wednesday, March 24, 2010 1:38 PM Report Comment

Oops, I think I posted on the wrong page. I agree with Broll, though. How can anyone object to the tanning bed business tax. Come on...
>> Someone not making 250,000 Wednesday, March 24, 2010 1:43 PM Report Comment

I am tired of hearing people whine about the "Evil Rich". I have not seen anyone making $50K creating jobs-80% of jobs in this country are created by small business owners and the like. THEY are the ones capable of giving you a job, not that guy making $30K! Also, anytime a company has to spend extra money on things like more taxes, higher wages, (and now) higher health costs, guess who eventually pays? Yep-you and me. By the way-the heads of Fannie Mae and Freddie Mac (yes, Barney Franks' peeps in charge) were paid 6 million in bonuses and salaries.
>> Doug Wednesday, March 24, 2010 5:36 PM Report Comment

Doug is absolutely right. Someone who makes money can buy something from you. A person who makes a LOT of money can give you a job. If all his money is taken away and given to the government, he can no longer give you a job, and money that goes to the government goes ?????. There are government jobs sure, but a lot of that money goes where the missing socks from the dryer go. Any cost that a company incurs gets passed on to its customers in the form of higher prices. And don't be deceived, there are evil people in EVERY tax bracket.
>> Jette Wednesday, March 24, 2010 9:37 PM Report Comment

Doug is wrong. He says most jobs are created by small business, then says he hasn't seen anyone making $50K creating jobs. I have seen plenty of small business owners who struggle to even make a profit. I used to think the employer mandate was a big tax, until I learned that only 5% of business have over 50 workers. Of those, 96% already offer health care, so the mandate barely effects the market. I bet the "Evil rich" own that other 4%, so they can pay for it anyway. Just kidding.
>> Clayton Thursday, March 25, 2010 4:48 AM Report Comment

Clayton---'5% of business owners may have over 50 workers', but it is likely that they employ most of the people in the U.S. Where are you getting these statistics that 96% of small businesses offer insurance. Doug-isn't an LLC -a 'limited liability 'corporation''? Jeffe...the money that goes to the government helps to pay for ALL of us to have potable water, cleaner air, roads, sewage systems, trash pick up, libraries, schools and health care for seniors. As well as funding for emergency departments to take care of the uninsured who show up there for their primary care because they do not have insurance.I do not think rich people are inherently evil, but unchecked capitalism that puts profit over everything else is.
>> Someone not making $250,000 Thursday, March 25, 2010 5:46 PM Report Comment

Even if 96% of businesses offer insurance, people do not take it because it is either too expensive or the policy sucks. I had a great insurance policy with my job, but my out of pocket monthly expenses were 380/month for 2 people. And my employer paid almost $10,000/year to the insurance company for me. I just do not think that is fair, since I the CEO of blue cross received a 26 percent raise. http://www.boston.com/business/healthcare/articles/2009/02/28/blue_cross_ceos_pay_rose_26/ I have known executives of VERY large corporations and they just aren't smart enough to deserve to make salaries in the millions on people's illnesses.
>> Someone not making $250,000 Thursday, March 25, 2010 6:03 PM Report Comment

According to my information, almost half of all people (around 51 million people) employed by businesses are employed by a business with over one thousand employees. Only about a million people are employed by a business with only 10-1,000 employees. http://www.sba.gov/advo/research/us_06ss.pdf Surely a business with over one thousand people should be required to provide reasonable insurance its employees. Businesses should WANT to insure its employees. Do you really want someone showing up for work with tuberculosis that has gone untreated? Or to not get preventative tests like colonoscopies and mammograms?
>> Someone not making $250,000 Thursday, March 25, 2010 6:39 PM Report Comment

Not Making... - I am not opposed to taxation to pay for all those nice things you mentioned and things you didn't mention such as natonal defense. I agree unchecked capitalism is a bad idea because there are greedy people who will run over everybody in their path. But there has to be a balance. When you tax businesses or enact legislation that increases the cost of doing business, that business can't hire as many people. Simple as that. Taxing businesses won't stop CEO's from being greedy. We need to find other ways to motivate them not to be greedy.
>> Jette Thursday, March 25, 2010 6:45 PM Report Comment

Actually MOST small business owners make WAY less than 250,000/year. I empathize with those business owners. Doug---If you make a 250,000 of profit on your business, by the way, you SHOULD be providing health coverage for all of your employees. And fair wages. Without any need for government involvement.
>> Not making 250,000 Thursday, March 25, 2010 9:51 PM Report Comment

LLC stands for Limited Liability Company. An LLC can either be taxed as a partnership or a corporation. If it is taxed as a partnership, the income flows through to the members (owners) to their own form 1040. If it is a corporation, it can either be an S-corporation or C-corporation. The income or loss from the S-corporation flows through to its owner’s personal income tax returns while the C-corporation pays its own tax. Any distributions (dividends) from a C-Corporation are then taxed again to its owners.
>> Eric Friday, March 26, 2010 2:30 AM Report Comment

If a small business earns $250,000, it does not mean that represents cash in the bank. That $250,000 is likely tied up in inventory, accounts receivable and property, plant & equipment. It is quite possible to show $250,000 in taxable income and not have any money. For example, let's assume that a business makes one sale and makes $250,000 and invests the entire $250,000 in inventory to expand the business. The inventory is not deductible from income until the business sells it. Therefore, there is $250,000 in income and no cash. Obviously, this is simplified, but the same thing could have happened if the business owner had to pay down debt with the income.
>> Eric Friday, March 26, 2010 2:34 AM Report Comment

In the interest of full disclosure, I am a CPA and have witnessed this basic fact pattern many times. The average worker is just that, a worker, not a business owner. Therefore, he or she is usually not aware of the income taxation issues and other issues a business owner has. In many cases lending institutions require certain income and expense ratios. Sometimes they require that the business owner keep a certain amount in the bank as what is known as a compensating balance. Income does not equal cash in the bank.
>> Eric Friday, March 26, 2010 2:40 AM Report Comment

It is quite naive for one to say that any business owner SHOULD provide health care simply because that is what he or she makes. Mr. Obama made quite a bit of money selling books (way more than $250,000) and I doubt that he paid anyone's health insurance that worked for him along the way to publishing those books. While we certainly need reform, I do not believe that anyone is entitled to health care anymore than they are entitled to any other service or product available. Sadly, it is this entitlement mentality that is going to ruin us.
>> Eric Friday, March 26, 2010 2:44 AM Report Comment

Health care IS a basic human right. You obviously have never seen anyone die due to lack of insurance. I have, many times. The only reason our country doesn't seem to care about this is because this problem disproportionately affects minorities and we are still a segregated nation in many ways. We are the only developed nation cruel enough not to provide care to all of our people when most of us have so much. “Of all the forms of inequality, injustice in health care is the most shocking and inhumane.” — Martin Luther King Jr. in a speech to the Medical Committee for Human Rights, 1966
>> Not making Friday, March 26, 2010 10:11 AM Report Comment

Also, we all end up paying for healthcare anyway...when people do not get primary care and end up on disability, or in the ICU for many months. And tell me this...why will we pay for dialysis treatment(through disability), but not for treatment to prevent kidney failure? Dialysis plus a disability check is much more expensive than paying for a primary care provider visit and medications. What if you had no insurance and very little money? People never think it will happen to them. People SHOULD be entitled to BASIC medical care. It is not a welfare check. It is life-saving. The entitlement comes in when obese people keep eating crap and now need 3 AND 4 knee replacements-THAT is entitlement. Disgusting.
>> Not making Friday, March 26, 2010 10:20 AM Report Comment

@Not: You have no idea whether I have seen someone die due to a lack of insurance. The fact is I have. You and I have a fundamental difference of opinion on that issue. I have no personal ax to grind with you and therefore will not stoop to personal attacks like others do. I would caution you to be wary of absolutes such as the word "only" as I am sure there are other reasons that we don't tackle this problem as many would like; cost is chief among them in my view. Again we may have to agree to disagree here, but I understand your viewpoint. Let's not confuse emotion for fact however.
>> Eric Friday, March 26, 2010 10:22 AM Report Comment

@ Not Making - Health care is NOT a "basic human right" because it REQUIRES the money (ie life/effort) of another person. There are no other rights in our amended Constitution which require an expenditure from other citizens and NO human has a right to claim the life, or a protion thereof, of another human.
>> DaleC Wednesday, March 31, 2010 6:10 PM Report Comment

Seriously? I'm vehemently opposed to this bill, but this is a terrible article. Special needs kids tax? Okay... it might affect those parents, but that portion of FSA users has got to be incredibly small. Why put some ridiculous tag line on this? These new regulations are seriously damaging on their own without misleading shock value tags. I'd love to see a good article that uses facts and actual consequences of this crap instead of just trying to rile people up. This is a dangerous slope to be walking down. The only thing taglines like that do is to give the opposition ammunition to rebut it. No one needs this slurry of fact and presumption. This article is damaging to our cause!! The truth is bad enough as it is!
>> A concerned CPA Thursday, April 1, 2010 2:02 PM Report Comment

Concerned: I could not agree with you more. I am also a CPA and now we are going to have to not only learn all this, but deal with the IRS in a whole new way. This bill is unconstitutional on so many levels. It does not bend the cost curve down, but instead just simply changes who pays and how much. I just learned today that my policy that has a $5,000 deductible is not available anymore. Washington has decided that to protect myself from myself I can't have a higher deductible and lower monthly premium. Don't you just love it?
>> Eric Thursday, April 1, 2010 9:56 PM Report Comment