Tag Archive for Affordable Care Act

Questions To Ask NOW Regarding The Affordable Care Act

Smiley who have some questions

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

Premium Tax Credit Saga – New Developments And Dilemmas

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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

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

TaxConnections Picture - ObamaCare Ahead A

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

Top 5 2013 US Expat Tax Updates for Americans Living Abroad

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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

US Citizens Abroad and OBAMACARE

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Commencing January 1, 2014, the “Affordable Care Act”, more derisively known as “OBAMACARE” will require that Americans carry so-called “minimum essential health coverage” (basically, health insurance) or suffer payment of a tax penalty. The provision applies to any individual who is a United States citizen or who qualifies as US “resident” for federal income tax purposes (e.g., a green card holder or one who meets the so-called “substantial presence” test). The rules apply to those individuals of all ages, including children. The married couple or adult who can claim a child or another individual as a dependent for federal income tax purposes is responsible for making the payment if the dependent does not have the required health coverage or if an exemption does not apply.

An important exemption exists for certain US persons who are living and working abroad if Read more

Government Shutdown, One Tax Provision In Debt Ceiling Deal

TaxConnections Picture - Debt CeilingWednesday’s deal to fund the federal government through January 15 and to extend the federal government’s borrowing authority through February 7 in the end contained only one tax provision, making a minor change to 2010’s health care legislation. The agreement, H.R. 2775, was passed by the Senate in an 81–18 vote on Wednesday and by the House of Representatives in a 285–144 vote. President Barack Obama is expected to sign it immediately, without an increase in the debt ceiling, since a U.S. debt default could happen soon.

A separate part of the agreement, not included in the bill but made in a separate Senate motion, will create a framework for formal budget negotiations. These will be scheduled to conclude by December 13, with negotiators charged with making recommendations for long-term budget and deficit reduction goals.

The change to the health care law under the agreement reached Wednesday sets up a new requirement that the eligibility of people who receive cost-sharing reductions under Section 1402 of the Patient Protection and Affordable Care Act, P.L. 111-148, or the health insurance premium tax credit under Sec. 36B, be verified. Under the agreement, the secretary of Health and Human Services must ensure that health insurance exchanges verify that individuals applying for the credit or cost-sharing Read more

TaxConnections Worldwide Tax Blogs Traffic Soars On Posts Related To “Obama Care”

TaxConnections CEO and Blogger Kat Jennings posts high traffic with Obama Care PostsTraffic on blogs related to Obama Care have recently soared due to consumers interest in tax increases associated with the new healthcare plan. With more than one billion consumers going online for tax advice each year, TaxConnections Worldwide Tax Blog has grown into a valuable resource for tax information.

“Our site traffic increased 20X over the last six months, we are paying close attention to what is trending. Obama Care posts send our traffic soaring through the roof. People want to be informed about the tax increases associated with Obama Care, in a language they can understand, and that is what we give them at TaxConnections”, states Kat Jennings, Founder and CEO of TaxConnections, a niche authority site of tax experts. There are numerous tax hikes that accompany Obama Care that largely affect families and small businesses that include:

1) Investment Income 3.8 Surtax on income earned over $200,000 for single head of households, and $250,00 for income earned on combined households over $250,000. The 3.8% Surtax does not apply to Non-Resident Aliens.

2) Individual Mandate Excise Tax and Employer Mandate Tax, states that anyone not buying “Qualifying Health Insurance” must pay an income surtax of 1%-2.5%. If an Employer does not offer health care coverage, and at least one employee qualifies for a health tax credit, the employer must pay an additional non-deductible tax of $2000 for all full-time employees. This applies to all employers with fifty or more employees. If any employee Read more

The Affordable Care Act

TaxConnections Blogger Chuck Heyde posts about the affordable care actThe Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010 (together, the Affordable Care Act), was landmark legislation that dramatically affects how health care is delivered in the United States. Provisions of the legislation affect not only those directly involved in providing health care, but also most individuals and employers.

The health care reform legislation is extremely complex, and many items in the legislation change rules and regulations that were already in place. The IRS, Department of Labor (DOL), Department of Health and Human Services (HHS), and other agencies have the monumental task of interpreting the legislation and providing guidance. Many temporary and proposed regulations, as well as some final regulations, have been issued.

The purpose of this legislation was to provide affordable minimum health care benefits to all individuals. With that in mind, the legislation provides for the establishment of qualified health plans that must provide essential health benefits consisting of minimum essential coverage.

Caution: Some of the rules originally enacted have already been repealed and the effective date of other rules has been modified. It is possible that more changes will occur as these rules are implemented. This information is Read more

Obamacare Provisions Postponed – And The IRS Has To Implement

iStock_usa umbrellaXSmallThe requirement that businesses provide their workers with health insurance or face fines – a key provision contained in President Barack Obama’s sweeping health care law – will be delayed by one year the Treasury Department said Tuesday.

The postponement came after business owners expressed concerns about the complexity of the law’s reporting requirements the agency said in its announcement. Under the Affordable Care Act, businesses employing fifty or more full-time workers that don’t provide them health insurance will be penalized.

We recognize that the vast majority of businesses that will need to do this reporting already provide health insurance to their workers, and we want to make sure it is easy for others to do so. We have listened to your feedback. And we are taking action,”

Mark J. Mazur, assistant secretary for tax policy wrote in a post on the website of the Treasury Department, which is tasked with implementing the employer mandate. Mazur said the extra year before the requirement goes into effect will allow the government time to assess ways to simplify the reporting process for businesses. Penalties for firms not providing health coverage to employees will now begin in 2015 – after next year’s congressional elections. Read more

ObamaCare’s Health Insurance Premium Tax Credit Proposed Regulations

The Affordable Care Act or ObamaCare was passed almost three years ago with the goal of extending quality health insurance coverage to more Americans and it becomes fully effective January 1st 2014. To encourage compliance, the Act for all intents and purposes takes a carrot-and-stick approach as credits are offered for those who need financial help with buying insurance, and penalties are defined for those who do not get insurance. The Act’s core requirements are most Americans must have health insurance and that all but small employers must offer insurance to full-time employees.

In other words if you are a United States citizen or legal resident you must have “minimum essential” health insurance coverage and your dependents must also be covered or risk being essentially penalized. Exemptions will be allowed for: Read more