Archive for Affordable Healthcare Act

Questions To Ask NOW Regarding The Affordable Care Act

As an astute navigator of the Internal Revenue Code over the last decade or so I’ve been asked by media heads for my opinions on the Affordable Care Act. Even though I have many to offer the fact of the matter is the deeper I get into the compliance reporting abyss the less sense it seems to make. The following four quotes I can hang my hat:

“For sure the ONLY thing we can rely on, barely, seems to be TITLE 26 and the best place to start your journey in these regards is with the Department of Health & Human Services.”

“The IRS is implementing the tax provisions of Affordable Care Act – and the 2014 filing season is shaping up to be a N-I-G-H-T-M-A-R-E! So be nice to our friends who work in bureaucracy, we are all in this together.” Read More

Written by | Posted in Affordable Healthcare Act

Premium Tax Credit Saga – New Developments And Dilemmas

On Friday (11/7/14), the US Supreme Court granted cert in King v. Burwell, 759 F.3d 358, No. 14-1158 (4th Cir., 7/22/14). This is the case where the court found the IRS regulations allowing individuals to claim a premium tax credit (PTC), even if they obtain coverage on a federal exchange rather than a state exchange. In contrast, in Halbig v. Burwell, 758 F.3d 390, No. 14-5018 (DC Cir., 7/22/14), a divided court found the IRS regulation invalid. The King and Halbig decisions were issued on the same day in July.

In September 2014, the Eastern District Court of Oklahoma issued a decision, State of Oklahoma v. Burwell, No. CIV-11-30-RAW (ED Ok, 9/30/14), finding the regulations invalid.

The DC Court of Appeals vacated its July decision, agreeing to hear the case en banc. Read More

Written by | Posted in Affordable Healthcare Act • Individual • IRS

Premium Credits Under The Affordable Health Care Act

Under the Affordable Health Care Act (ACA), individuals who purchase health care coverage through an exchange and whose income is under certain amounts will be eligible for tax credits. Form 8962 will be used to enter any advance credits received and amounts entitled to for the current tax year. The net amount (credit entitled to less the advance credit) is then entered on a separate line on the back of Form 1040 or 1040A. Taxpayers who claim the credit cannot file Form 1040 EZ (for AGI less than $100,000 and do not itemize and don’t have any dependents) but must file Form 1040 or 1040A. If you are eligible for the credit, you can choose to:

• Get it now: have some or all of the estimated credit paid in advance directly to your insurance company to lower what you pay out-of-pocket for your monthly premiums. Read More

Written by | Posted in Affordable Healthcare Act • Small Business

Penalties For Not Having Healthcare Coverage Under The Affordable Health Care Act

The 2010 Affordable Health Care Act (ACA) (“Obama Care”) provided that taxpayers who elect not to be covered by health insurance will be subject to a penalty starting in 2014. The penalty will be paid when their federal tax return is filed. There are some exceptions when the penalty will not apply. Taxpayers who purchase coverage through an exchange will receive Form 1095-A reporting the monthly health care premiums paid and any advance premium credit payments.

This article will discuss the penalties, penalty exceptions and tax forms required to report.

Flat Amount

In 2014, this will be $95 per adult and $48 for each child under age 18. The maximum Read More

Written by | Posted in Affordable Healthcare Act

Tax Compliance Alert: IRS Prepares For Impact of Obamacare On 2015 Tax Season

Introduction

On Wednesday, September 10th the Internal Revenue Service (hereinafter the “Service”) Commissioner John Koskinen (hereinafter “Commissioner Koskinen”) informed a congressional subcommittee about the Service’s progress on the Affordable Care Act and the impact that tax subsidies will have on the upcoming 2015 tax season. In a hearing before the House Ways and Means Health Subcommittee, Commissioner Koskinen discussed how the Service would be processing the premium tax credit, which helps subsidize the cost of health insurance coverage for eligible taxpayers.

Commissioner Koskinen duly noted that eligible taxpayers can choose to have their Read More

Written by | Posted in Affordable Healthcare Act • IRS • Tax Controversy

What Is A FTE? What Is A Seasonal Employee?

My friend, confidant, mentor and expert in the procedural ramifications of ObamaCare, Debbie Nash of D. Nash & Associates, got to talking with me about some of the nuances of this legislation and our discussion quickly digressed into what the definition is of a ‘Full Time Equivalent’ (FTE) employee for IRS tax purposes. One of many reasons I appreciate time together with Debbie is our electrifying and challenging conversations. She keeps me on my toes continually pushing me to be a more astute student of the Internal Revenue Code.

After deliberate debate and further review it quickly became apparent to me that part of this precedent setting legislative action is to simply create long term jobs for the legal industry simply because there are so many unanswered questions. One on the menu today is how Read More

Written by | Posted in Affordable Healthcare Act • Corporate • Small Business

Will I Owe an “Individual Shared Responsibility Payment” for 2014?

The IRS addressed in its Health Care Tax Tip 2014-04 the question of whether a taxpayer owes an “Individual Shared Responsibility Payment” to be paid with the 2014 tax return filed by April 15, 2015.

Do I owe it? And if so, how much do I owe?

The short answer is that for any month in 2014 that a taxpayer or any of a taxpayer’s dependents do not maintain health care coverage and do not qualify for an exemption from having health care coverage, then the taxpayer will owe an “individual shared responsibility payment” with your 2014 tax return filed in 2015.

What is the “less than three-month gap” exemption/exception?

Read More

Written by | Posted in Affordable Healthcare Act • Income Tax • Individual

Employers Face Stiff Affordable Health Care Act Excise Taxes (aka Penalties)

The Affordable Health Care Act (ACA) (“Obama Care”) may lead to stiff excise taxes for larger and midsize employers that misclassify employees as independent contractors (see §4980H Shared responsibility for employers regarding health coverage). The term “applicable large employer” means, with respect to a calendar year, an employer who employed an average of at least 50 full-time employees on business days during the preceding calendar year.  The term “full-time employee” means, with respect to any month, an employee who is employed on average at least 30 hours of service per week.  However, employers with less than a 100 employees have a transition period until 2016 for the application of §4980H.

Employers that misclassify employees as independent contractors already face potential tax Read More

Written by | Posted in Affordable Healthcare Act

Top 5 2013 US Expat Tax Updates for Americans Living Abroad

The tax season is upon us and as expats begin the arduous task of gathering documents for their US tax preparation, it seems like a good time to provide an overview of the 2013 tax changes that may impact expats. The most important impact may be saving money, so let’s take a closer look!

1)     The Foreign Earned Income Exclusion (FEIE)

We love that the Foreign Earned Income Exclusion adjusts for inflation each year! Last year the FEIE was $95,100 and this year it jumps to $97,600. This means you deduct the first $97,600 you earn—you could eliminate your entire US tax liability with this credit alone. However, it’s important to remember that you must ‘qualify’ as an expat to be Read More

Written by | Posted in Affordable Healthcare Act • Expatriate • FATCA • FBAR

Next Year Double Digit Health Plan Increases

Consumers eligible for Obamacare health plans could see double-digit price hikes next year in states that fail to draw large numbers of enrolls for 2014, according to insurance industry officials and analysts.

The early estimates come as insurance companies set out to design plans they intend to sell in 2015 through the state-based health insurance marketplaces that are a centerpiece of the Affordable Care Act, President Barack Obama’s signature domestic policy achievement that is widely referred to as Obamacare.

WellPoint Inc, which sells plans on 14 Obamacare exchanges, expects health insurance rates nationwide to be higher. Increases for the Obamacare market that has signed up Read More

Written by | Posted in Affordable Healthcare Act

Department of Treasury Issues Final Treasury Regulations Governing Employee Health Care Coverage

The Department of Treasury recently issued final treasury regulations (T.D. 9655 (2/12/14)) governing the implementation of the shared responsibility provisions for employee health care coverage required under I.R.C. § 4980H, as enacted by the Affordable Care Act. Pursuant to the employer shared responsibility provisions, if employers to whom the rules apply do not offer affordable health coverage that provides a minimum level of coverage to their full-time employees and their dependents, the employer may be subject to an employer shared responsibility payment if at least one of its full-time employees receives a premium tax credit for purchasing individual coverage on one of the new Affordable Insurance Exchanges (e.g., Health Insurance Marketplace).

The employer shared responsibility provisions apply to employers that have 50 or more Read More

Written by | Posted in Affordable Healthcare Act • Federal • IRS

Expatriate Year End Tax Planning

Year-end tax planning could be especially productive this year because timely action could nail down a host of tax breaks that won’t be around next year unless Congress acts to extend them, which, at the present time, looks doubtful. These include, for individuals: the option to deduct state and local sales and use taxes instead of state and local income taxes; the above-the-line deduction for qualified higher education expenses; and tax-free distributions by those age 70-1/2 or older from IRAs for charitable purposes.

Some areas to draw your attention are listed below:

NEW HIGH INCOME SURCHARGES

High-income-earners have other factors to keep in mind when mapping out year-end plans. Read More

Written by | Posted in Affordable Healthcare Act • Expatriate • FBAR • Federal • Individual • International • OVDP • Treasury Regulations
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