It’s a pretty solid bet that the Affordable Care Act aka ObamaCare will be neither affordable nor primarily about improving health care in this country when its main enforcement arm will be the Internal Revenue Service.
Regardless of how the fiscal cliff negotiations pan out, Americans will be hit with a $1 trillion tax hike over the next 10 years from the 20 taxes contained within ObamaCare.
Americans for Tax Reform lays out the 5 taxes contained with ObamaCare that will be rolled out next Tuesday. They are as follows:
1. ObamaCare Medical Device Tax: 2.3% excise tax on gross sales of devices. Please note that is sales and not profits.
2. ObamaCare Flex Account Tax: Will set a cap of $2500 on the Flexible Spending Account on the 30-35 million Americans that use it. Currently, there is no federal cap, though employers can set caps of their own. This will especially hit hard the families of special needs children whom rely heavily on the FSA to pay those medical bills.
3. ObamaCare Surtax on Investment Income: 3.8% surtax on investment income earnings on those households making at least $250,000. Combine this with the jump in taxes on investment income earnings with the (expected) expiration of the Bush tax cuts and it becomes a case of piling on. For example, dividend rates may increase from 15% to 43.4%. And who said this administration wasn’t about class warfare? (go to the link for more comprehensive charts)
4. The ObamaCare “Haircut” for Medical Itemized Deductions: Raises the deduction floor for medical expenses on Adjusted Gross Income from 7.5% to 10%, hitting the elderly and those with modest incomes but high medical expenses the hardest. Can't you just feel the compassion?
5. The ObamaCare Medicare Payroll Tax Hike: Currently, the Medicare payroll tax is 2.9% on wages and self-employment profits. Wages and profits exceeding $200,000 ($250,000 for married couples) will face a 3.8% rate. Again, for small business owners with a small profit margin, this is not an insignificant rate hike.
Nancy Pelosi was right. We had no idea just what was in the 2200+ page ObamaCare legislation – so we’re sure glad they passed it so we can now find out what all is in it.
And ain’t it grand?