I was giving a presentation on Healthcare Reform last week and discovered that it was helpful to put the reform into a timeline. The following timeline is not all inclusive but it does put the points that I have talked about in earlier blogs into a timeline.
In 2010 that’s this year folks!
1. When you visit a tanning center after 7/1/10 you will have a 10% excise tax added to the tanning service. http://tinyurl.com/Odd-Changes
2. Eligible small business owners will have a credit available to them when preparing their 2010 tax returns. Remember that eligible means 10 or fewer employees. http://tinyurl.com/Small-Biz-Health-Credit
3. Children under the age of 27 are eligible to remain covered on your employer provided health insurance plan. http://tinyurl.com/Odd-Changes
4. The adoption credit has been increased to $13,170 per eligible child and the credit has been made refundable. The refundable part is very exciting!
1. Your W2 will include the cost of employer provided health insurance. No this amount will not be taxable it will just be information that is reported to the IRS in order for them to determine if you have health insurance. It will become very important when penalties for lack of insurance kick in.
2. You can no longer be reimbursed for over the counter medication from your Health Savings Account or your Flexible Spending Arrangement. http://tinyurl.com/Odd-Changes
3. You will be charged a 20% penalty instead of a 10% penalty if you remove funds from your Health Savings Account for non medical items. http://tinyurl.com/Odd-Changes
1. Only 1 change implemented in 2012 but it is a big one. Information reporting on 1099’s will now include corporations and payments for products. So if you are a business and you pay a Vendor more than $600 in a year you will send them a 1099.
1. An additional .9% hospital insurance tax to wages received in excess of $250,000. http://tinyurl.com/Odd-Changes
2. An additional 3.8% surtax on unearned income. http://tinyurl.com/3-8-Surtax
3. Threshold for deducting medical expenses increases to 10%. http://tinyurl.com/Odd-Changes
4. Contributions to a Flexible Spending Account will be limited to $2,500. Currently there is not a federal imposed limit but employer’s often impose a limit.
5. Each health insurance policy will have a $2 fee attached to them multiplied by the number of lives the insurance covers. (One insurance policy covering 25 employees will have a $50 fee)
1. Larger employers not offering affordable health insurance coverage will have a penalty. http://tinyurl.com/SM-Biz-Penalty
2. Individuals not carrying health insurance will have a penalty. http://tinyurl.com/Indiv-Health-Ins-Penalty
3. Employers must offer “free choice” vouchers for basic health care coverage. Employers offering minimum essential coverage through an employer sponsored plan & paying a portion of that coverage must provide qualified employees with a “free choice” voucher whose value can be applied to purchase a health plan through an Insurance Exchange.
4. A refundable credit will be available to qualifying taxpayers who get health insurance coverage by enrolling in a State established Health Benefit Exchange.
5. An excise tax will be imposed on health insurance providers.
Add to this list tax rate increases in 2011 and the next 4 years are going to be very interesting ones in the tax world!