20 Hidden Tax Hikes in Obamacare

From the ATR website.



The Obamacare law contains 20 new or higher taxes on American families and small businesses



Taxpayers are reminded that the president’s healthcare law is one of the largest tax increases in American history.



Obamacare contains 20 new or higher taxes on American families and small businesses.



Arranged by their respective effective dates, below is the total list of
all $500 billion-plus in tax hikes (over the next ten years) in
Obamacare, where to find them in the bill, and how much your taxes are
scheduled to go up as of today:



Taxes that took effect in 2010:



1. Excise Tax on Charitable Hospitals (Min$/immediate):
$50,000 per hospital if they fail to meet new "community health
assessment needs," "financial assistance," and "billing and collection"
rules set by HHS. Bill: PPACA; Page: 1,961-1,971.



2. Codification of the “economic substance doctrine”
(Tax hike of $4.5 billion). This provision allows the IRS to disallow
completely-legal tax deductions and other legal tax-minimizing plans
just because the IRS deems that the action lacks “substance” and is
merely intended to reduce taxes owed. Bill: Reconciliation Act; Page:
108-113.



3. “Black liquor” tax hike (Tax hike of $23.6 billion). This is a tax increase on a type of bio-fuel. Bill: Reconciliation Act; Page: 105.



4. Tax on Innovator Drug Companies ($22.2 bil/Jan
2010): $2.3 billion annual tax on the industry imposed relative to share
of sales made that year. Bill: PPACA; Page: 1,971-1,980.



5. Blue Cross/Blue Shield Tax Hike ($0.4 bil/Jan 2010):
The special tax deduction in current law for Blue Cross/Blue Shield
companies would only be allowed if 85 percent or more of premium
revenues are spent on clinical services. Bill: PPACA; Page: 2,004.



6. Tax on Indoor Tanning Services ($2.7 billion/July 1, 2010): New 10 percent excise tax on Americans using indoor tanning salons. Bill: PPACA; Page: 2,397-2,399.



Taxes that took effect in 2011:



7. Medicine Cabinet Tax ($5 bil/Jan 2011): Americans no
longer able to use health savings account (HSA), flexible spending
account (FSA), or health reimbursement (HRA) pre-tax dollars to purchase
non-prescription, over-the-counter medicines (except insulin). Bill:
PPACA; Page: 1,957-1,959.



8. HSA Withdrawal Tax Hike ($1.4 bil/Jan 2011):
Increases additional tax on non-medical early withdrawals from an HSA
from 10 to 20 percent, disadvantaging them relative to IRAs and other
tax-advantaged accounts, which remain at 10 percent. Bill: PPACA; Page:
1,959.



Taxes that took effect in 2012:



9. Employer Reporting of Insurance on W-2 (Min$/Jan 2012): Preamble to taxing health benefits on individual tax returns. Bill: PPACA; Page: 1,957.



Taxes that take effect in 2013:



10. Surtax on Investment Income ($123 billion/Jan.
2013): Creation of a new, 3.8 percent surtax on investment income
earned in households making at least $250,000 ($200,000 single). This
would result in the following top tax rates on investment income: Bill:
Reconciliation Act; Page: 87-93.

	Capital Gains	Dividends	Other*
2012	15%	15%	35%
2013+	23.8%	43.4%	43.4%

*Other unearned income includes (for surtax purposes) gross income
from interest, annuities, royalties, net rents, and passive income in
partnerships and Subchapter-S corporations. It does not include
municipal bond interest or life insurance proceeds, since those do not
add to gross income. It does not include active trade or business
income, fair market value sales of ownership in pass-through entities,
or distributions from retirement plans. The 3.8% surtax does not apply
to non-resident aliens.



11. Hike in Medicare Payroll Tax ($86.8 bil/Jan 2013): Current law and changes:

	First $200,000 ($250,000 Married) Employer/Employee	All Remaining Wages Employer/Employee
Current Law	1.45%/1.45% 2.9% self-employed	1.45%/1.45% 2.9% self-employed
Obamacare Tax Hike	1.45%/1.45% 2.9% self-employed	1.45%/2.35% 3.8% self-employed

Bill: PPACA, Reconciliation Act; Page: 2000-2003; 87-93



12. Tax on Medical Device Manufacturers ($20 bil/Jan
2013): Medical device manufacturers employ 360,000 people in 6000 plants
across the country. This law imposes a new 2.3% excise tax. Exempts
items retailing for <$100. Bill: PPACA; Page: 1,980-1,986



13. Raise "Haircut" for Medical Itemized Deduction from 7.5% to 10% of AGI
($15.2 bil/Jan 2013): Currently, those facing high medical expenses are
allowed a deduction for medical expenses to the extent that those
expenses exceed 7.5 percent of adjusted gross income (AGI). The new
provision imposes a threshold of 10 percent of AGI. Waived for 65+
taxpayers in 2013-2016 only. Bill: PPACA; Page: 1,994-1,995



14. Flexible Spending Account Cap – aka “Special Needs Kids Tax” ($13
bil/Jan 2013): Imposes cap on FSAs of $2500 (now unlimited). Indexed
to inflation after 2013. There is one group of FSA owners for whom this
new cap will be particularly cruel and onerous: parents of special needs
children. There are thousands of families with special needs children
in the United States, and many of them use FSAs to pay for special needs
education. Tuition rates at one leading school that teaches special
needs children in Washington, D.C. (National Child Research Center) can
easily exceed $14,000 per year. Under tax rules, FSA dollars can be used
to pay for this type of special needs education. Bill: PPACA; Page:
2,388-2,389



15. Elimination of tax deduction for employer-provided retirement Rx drug coverage in coordination with Medicare Part D ($4.5 bil/Jan 2013) Bill: PPACA; Page: 1,994



16. $500,000 Annual Executive Compensation Limit for Health Insurance Executives ($0.6 bil/Jan 2013). Bill: PPACA; Page: 1,995-2,000



Taxes that take effect in 2014:



17. Individual Mandate Excise Tax (Jan 2014): Starting
in 2014, anyone not buying “qualifying” health insurance must pay an
income surtax according to the higher of the following

	1 Adult	2 Adults	3+ Adults
2014	1% AGI/$95	1% AGI/$190	1% AGI/$285
2015	2% AGI/$325	2% AGI/$650	2% AGI/$975
2016 +	2.5% AGI/$695	2.5% AGI/$1390	2.5% AGI/$2085

Exemptions for religious objectors, undocumented immigrants,
prisoners, those earning less than the poverty line, members of Indian
tribes, and hardship cases (determined by HHS).Bill: PPACA; Page:
317-337



18. Employer Mandate Tax (Jan 2014): If an employer
does not offer health 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. Applies to all employers with
50 or more employees. If any employee actually receives coverage
through the exchange, the penalty on the employer for that employee
rises to $3000. If the employer requires a waiting period to enroll in
coverage of 30-60 days, there is a $400 tax per employee ($600 if the
period is 60 days or longer).Bill: PPACA; Page: 345-346



Combined score of individual and employer mandate tax penalty: $65 billion/10 years



19. Tax on Health Insurers ($60.1 bil/Jan 2014): Annual
tax on the industry imposed relative to health insurance premiums
collected that year. Phases in gradually until 2018. Fully-imposed on
firms with $50 million in profits. Bill: PPACA; Page: 1,986-1,993



Taxes that take effect in 2018:



20. Excise Tax on Comprehensive Health Insurance Plans
($32 bil/Jan 2018): Starting in 2018, new 40 percent excise tax on
“Cadillac” health insurance plans ($10,200 single/$27,500 family).
Higher threshold ($11,500 single/$29,450 family) for early retirees and
high-risk professions. CPI +1 percentage point indexed. Bill: PPACA;
Page: 1,941-1,956



Grover Norquist is president of Americans for Tax Reform, a
coalition of taxpayer groups, individuals, and businesses opposed to
higher taxes at the federal, state, and local levels. The coalition
organizes the Taxpayer Protection Pledge, which asks all candidates for
federal and state office to commit themselves in writing to oppose all
tax increases.