May
12, 2010
Dear
Client:
We
are writing to give you an overview of tax law changes recently enacted by
health care reform legislation and how it affects individuals, and small and
large businesses. Together, the “Patient
Protection and Affordable Care Act” and the “Health Care and Education Reconciliation
Act” establish a mandate for most
|
Calendar
of Health Care Reform Law Provisions |
|
|
|
2010 |
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* Dependent coverage
available for dependents under age 27 who are not covered by another
employer-sponsored plan |
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* Small employer (less
than 50 full-time equivalent employees) health insurance credit available for
making contributions to buy health insurance for its employees |
|
* Maximum adoption credit
and adoption exclusion are increased by $1,000 to $13,170 per child |
|
* 10% excise tax imposed on
any indoor tanning service |
|
|
|
2011 |
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* W-2 must include cost
of employer-provided health insurance |
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* Costs for
over-the-counter drugs not prescribed by a doctor not allowed to be
reimbursed through a flexible-spending account, health reimbursement account,
or an Archer Medical Savings Account |
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* Small employers
(average 100 or fewer employees prior 2 years) may establish simplified
cafeteria plans for their employees |
|
|
|
2012 |
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* Requirement to file
information returns (1099’s) for payments to corporations of $600 or more |
|
|
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2013 |
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* Flexible-spending
account contributions limited to $2,500 |
|
* Additional Medicare tax
of .9% on wages and self-employment income over $250,000 for joint filers
$125,000 for married filing separate filers, and $200,000 for all others |
|
* 3.8% Medicare tax
imposed on investment income of high income filers |
|
* Floor on unreimbursed
medical expenses deducted raised from 7.5% of adjusted gross income to 10%
(Remains unchanged for people age 65 and older) |
|
|
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2014 |
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* Individuals not
carrying health insurance begin paying a graduated penalty * Large employers not
offering affordable health insurance coverage must pay penalty |
|
* Employers offering
minimum coverage and paying a portion of that coverage must provide qualified
employees with "free choice" voucher |
|
* Exchanges made
available to individuals and small businesses |
|
* Refundable tax credit
("premium assistance credit") available to qualifying taxpayers who
get health insurance coverage through a state-established American Health
Benefit Exchange |
|
* Qualified health plans
may be offered through cafeteria plans by qualified employers |
|
|
|
2017 |
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* Floor on unreimbursed
medical expenses for people 65 & older increased to 10% |
We
hope this information is helpful. If you would like more details about these
provisions or any other aspect of the new law, please do not hesitate to call
our office or visit our website at http://www.goslingcpa.com/HealthReform2010.html.
Very
truly yours,
Gosling
& Company, P.C.
Certified
Public Accountants
IRS
Circular 230 Disclosure: To ensure compliance with requirements imposed by the
IRS, we inform you that any U.S. federal tax advice contained in this
communication (including any attachments) is not intended or written to be
used, and cannot be used, for the purpose of (i) avoiding penalties under the
Internal Revenue Code or (ii) promoting, marketing or recommending to another
party any transaction or matter addressed herein or in any attachment hereto.