SENATOR JOHANNS EXPLAINS HEALTH CARE LEGISLATION

Senator Johanns has a good video explaining in 4 minutes how the health care bill will pass through Congress. I thought you might be interested. Clients seem to be asking what next.

Click here to view: Status of Health Care Legislation

WASHINGTON REFORMS HEALTH CARE AND TAXES

Sunday's night's health care bill will go down as one of those once-in-a-generation accomplishments. I'm not here to debate the merits of the bill - historians will still be doing that decades from now. But it's important to point out some important tax changes included in the bill and the companion "reconciliation" bill now before the Senate. (Just how important are they? Well, the Congressional Budget Office says the IRS will need $10 billion and 17,000 new employees to enforce its share of the new rules!)

Here are some of the key tax provisions:

• Starting immediately, certain small businesses with less than 10 employees will get a 35% credit for the cost of providing employee health benefits.
• Starting in 2011, employers will have to report the value of health benefits on Form W2.
• The penalty tax for Health Savings Account distributions not used for health care expenses doubles from 10% to 20%. This will discourage using HSAs for supplemental retirement savings.
• Starting in 2013, the 7.5% floor for deducting medical and dental expenses climbs to 10% (unless you or your spouse are 65 or older, in which case it remains at 7.5% until 2016).
• Healthcare flexible spending account contributions are capped at $2,500 per year.
• Starting in 2014, businesses with more than 50 employees will have to offer health benefits or pay a penalty of $750/employee.

The reconciliation bill includes one more unwelcome surprise.

• Currently, the Medicare tax is limited to 2.9% of earned income (earned income is income from wages and self employment like business, partnership and LLC income). The reconciliation bill imposes an additional Medicare tax of 0.9% on earned income above $200,000 (individuals) or $250,000 (families).
• It also adds a 3.8% "Unearned Income Medicare Contribution" on investment income - specifically, interest, dividends, annuities, royalties, capital gains, and rents - for taxpayers with Adjusted Gross Income above those same thresholds. Those new levies would take effect in 2013.

The complete bill is 1,018 pages, so it's going to take some time to analyze. But we'll be paying close attention as details become available. In the meantime, email us with any questions.

Larry Kopsa CPA

IS THIS REALLY OUR AMERICA???

VOTE AS IF YOUR FUTURE DEPENDS ON IT… BECAUSE YOUR HEALTH CARE DOES……

If this health care bill passes we will get - - - - - CHANGE!!!!!!

PLEASE PLEASE PLEASE watch this U tube video. If you can't get
it on your computer, send it to someone who can and then go see it.

We have to do something and NOW.

Know The Truth About The Government Health Care Bill

'HEALTH CARE SURTAX WOULD HURT ECONOMY, HEALTH CARE'

(Budget & Tax News) -- The Heartland Institute reports that "the top tax rates in 39 states would climb above 50% under a plan to overhaul the nation’s health care system, according to an analysis by the nonpartisan Tax Foundation." "'This proposed tax increase will be levied at a time when Americans can least afford it and will affect countless small businesses that file individual returns,' including sole proprietorships, S Corporations, and partnerships, said economist Jonathan Williams, director of the Tax and Fiscal Policy Task Force of the American Legislative Exchange Council. ... 'This tax increase is a job killer, plain and simple,' Williams added." See more at <http://www.heartland.org/publications/budget%20tax/article/25914/Health_Care_Surtax_Would_Hurt_Economy_Health_Care.html

THE GOVERNMENT ISSUES "GAG ORDER" TO INSURANCE COMPANIES

HHS "Gag Order" Sent To Insurers Prompts Outrage From GOP

ABC World News reported during a Senate Finance Committee hearing "a war of words broke out over what one of the nation's largest health insurance companies is saying about the bill." The order "issued last night by the Department of Health and Human Services" tells "insurance companies who serve Medicare recipients to stop 'misleading' and 'confusing' mailings, saying, quote, 'we are instructing you to immediately discontinue all such mailings and remove any related materials from your websites.'

The extraordinary order comes in response to a mailing the Humana Insurance Company sent to customers in the Medicare Advantage Program," that "warned that because of Medicare cuts in the healthcare reform bills, quote, 'millions of seniors and disabled individuals could lose many important benefits and services.'"

Some legal experts "say the order is unconstitutional." The AP reports Peter Ashkenzaz, a spokesman for the Centers for Medicare and Medicaid, said, "Because these are Medicare contractors, we want to make sure that the health plans' communications to beneficiaries are not violating marketing requirements or using protected information like Medicare mailing lists improperly."

The Washington Post quotes Robert Zirkelbach, a spokesman for America's Health Insurance Plans, "the industry's main lobbying group, as saying, "Seniors have a right to know how the current reform proposals will affect the coverage they currently like and rely on."