Category: Healthcare Tax Penalty
Healthcare Tax Penalty for Employers and Individuals
In 2014, President Obama’s healthcare overhaul will require nearly every U.S. citizen to carry health insurance or face a healthcare tax penalty. The goal, in part, is to keep medical costs downs by reducing the number of uninsured patients.
The question remains, however, how many people will be hit with the tax penalty. It’s estimated that roughly 6 million Americans – up nearly 50 percent from previous estimates – will incur a healthcare tax penalty by 2016.
Those 6 million people – mostly middle class – are just a sliver of the 150 million people who are currently insured by employers. Yet, experts expect households to be penalized the higher of $695 per person or 2.5 percent of household income in 2016. There are exceptions; people with financial hardships, religious objections, and some others are not required to carry the private health insurance.
Meanwhile, businesses are also required to offer employee health insurance or pay a healthcare tax penalty. That penalty can reach up to thousands of dollars per full-time employee.
Reactions to the mandate are mixed. Many small business owners, those with fewer than 25 full-time employees, are allowed a tax credit under the new overhaul. The tax credit gives businesses that pay at least 50 percent of their employee’s premiums to write off up to 35 percent of their contributions. In 2014, the tax credit increases to 50 percent. This allows small business owners to pool together and negotiate better rates with insurance companies. On the other hand, many other business owners said they would have to lay off employees to afford the coverage.
Learn more about how the healthcare tax penalty will affect you or your business by reading the latest from HealthReform.com. Stay informed by signing up for our newsletter today.
from HR360 Recently issued final rules provide important guidance on the ‘pay or play’ provisions under Health Care Reform. These provisions require large employers–generally those with at least 50 full-time employees, including full-time equivalents–to offer affordable health insurance that provides a minimum level of coverage to full-time employees (and their dependents), or pay a penalty tax if any full-time employee receives a premium tax credit for purchasing individual coverage on a Health Insurance Marketplace. Below are… Continue reading
I guess delays have come to be expected with Health Reform. Well, on February 10, 2014, the Internal Revenue Service released the final employer responsibility rule, together with a fact sheet and a series of questions and answers about the rule. The rule finalizes rules proposed late in December 2012. Although the rule contains a number of transition provisions, three provisions seem to be getting the most attention – for good reason. The rule postpones until 2016 the application… Continue reading
If your role within your firm involves you touching any part of your group health insurance plan, these past few years have been anything but boring. Though there are still some legislators talking about killing the Affordable Care Act (dubbed Obamacare) by defunding it, it seems that most have agreed that it is finally time to understand and embrace the coming changes from Health Reform. That shift in thinking comes just in time for some… Continue reading
The following is a brief (under 10 minutes) update prepared for Employees who are currently receiving the Federally mandated Exchange notices. Feel free to share.
There will be 50 statewide insurance exchanges where consumers can compare premiums and coverage plans opening soon. The current administration has announced that it predicts low costs when the exchanges open on October 1st. How will the exchange lower premiums? In the last few years, many people have chosen to live without health insurance. This has especially been the case with young working class individuals between the ages of 18 and 35, which is the… Continue reading
On Wednesday July 17, the House of Representatives voted for further delays in the current administration’s Health Care Reform. In addition to a delay in the employer mandate the individual mandate is now under discussion. President Barack Obama responded, saying. “Despite all the evidence that the law is working the way it was supposed to for middle class Americans, Republicans in the House of Representatives voted, for nearly the 40th time, to dismantle it.” New… Continue reading
The implementation of the employer mandate provision of the Affordable Care Act was pushed back from 2014 to 2015, and now the individual mandate is at risk of being delayed as well. The mandate, which would require that individuals buy health insurance or pay a penalty, is set to go into effect in 2014. However, after the White House’s decision to hold off requiring businesses with 50 or more full-time workers provide insurance, House Speaker… Continue reading
The Affordable Care Act was launched in 2010, and while it never had a formal start date, the Obama administration has announced that the implementation of one key provision will be delayed until 2015. That delayed provision, known as the “employer mandate,” requires that any business with more than 50 employees must provide affordable health insurance coverage or pay a penalty. This delay will give administrators on both the business and government ends time to… Continue reading
As the nation continues to move toward massive changes in health care policy, certain government bodies are responsible for different aspects of the legislation and implementation. The Internal Revenue Service has a particularly significant role because the Affordable Care Act (ACA) contains the largest set of tax provisions and law changes in over two decades. Many supporters claim that it only makes sense to ensure the IRS helps oversee implementation of 500 new provisions and… Continue reading
Since President Obama came into office in 2008 and proposed what is now known as the Affordable Care Act, it has been subject to many small and large changes. Due to the nature of some of the initially proposed changes, the ACA has been adjusted, edited, and tweaked based on congressional, senate, and house votes. Many individuals, families, small businesses, and large corporations are confused about what health care coverage will actually look in 2014… Continue reading