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Awesome
2011 W-2 Tax Forms and Obamacare
If this doesn’t get to you, then check your pulse. You may be a flat line... Should you want to verify this, go to http://www.thomas.gov/, enter "HR 3590" in the search box and look for "CRS Summaries." This is what you'll find. Title IX Revenue Provisions—Subtitle A: Revenue Offset "(Sec. 9002) Requires employers to include in the W-2 form of each employee the aggregate cost of applicable employer-sponsored group health coverage that is excludable from the employee's gross income (excluding the value of contributions to flexible spending arrangements)." Starting in 2011—next year—the W-2 tax form sent by your employer will be increased to show the value of whatever health insurance you are provided. It doesn't matter if you're retired. Your gross income WILL go up by the amount of insurance your employer paid for. So you’ll be required to pay taxes on a larger sum of money that you actually received. Take the tax form you just finished for 2009 and see what $15,000.00 or $20,000.00 additional gross income does to your tax debt. That's what you'll pay next year. For many it puts you into a much higher bracket. This is how the government is going to buy insurance for fifteen (15) percent that don't have insurance and it's only part of the tax increases, but it's not really a "tax increase" as such, it a redefinition of your taxable income. Also, go to Kiplinger's and read about the thirteen (13) tax changes for 2010 that could affect you. |
Honu -- to be honest, I did exactly what you said we should do and looked up the bill, and it says nothing at all about everyone paying taxes on their employer's contributions to their healthcare plans.
Where did the last paragraph in your post come from? On CRS summary, the only mention of W-2s in the bill says this: Quote:
$8,000/yr is an awful lot of money, and it won't affect very many people is my best guess. My old employer had EXCELLENT health insurance that covered basically everything with no deductible, and they only contributed about $5,000/yr to it.... So like I said, it's okay to have a problem with that, but your post makes it sound like every American with employer-sponsored health insurance is going to start paying income taxes on the employer's contributions, which as far as I can tell, is 100% false, if I've read the above provisions correctly, as it simply says that the value of those contributions will be noted on the W-2, *not* included in the gross earnings -- as obviously it would have to be noted on a W-2 in order to determine who qualified for the excess tax listed above...they can't just guess. At least, I hope I'm right. |
Go to the bill itself scroll down to section 9002, it clearly states that people will have what their employers pay in insurance for them added to their W2. For me its no big deal because trainers dont provide health insurance for their employees but for my partner it could be a pretty big addition to her payroll.
Maybe I misunderstand it then, to me it seems that bill states that what the employer spends on insurance will be added to the employees taxable earnings, Id love to be wrong about this. |
That was awesome!!
(What the fucl< did he say?) |
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The way I read it, those whose employers pay more than $8K/yr for one employee or $23K/yr for employee + family, would be subject to a 40% tax on the premium paid ABOVE that amount. But how would the government know what the employer paid in premium contributions? They would know because it will be included on the W-2, which is, by my reading, what Sec. 9002 says. I don't interpret that in any way to say that the employer contributions will be rolled into gross income (thereby making them taxable income for EVERYONE), but rather that they will be included on the W-2 as a piece of information relevant for tax purposes. See what I'm saying with that? I hope I'm right, or I'll be right there with you blasting this....but I think I'm right on this one. |
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Dude Im so hoping I am wrong and you are right and I guess when we file our taxes for 2011 we will find out. |
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If the government knows, but the tax preparer doesn't know, then taxes will be underpaid, the IRS will go nuts, and it'll be a BIG issue because nobody will know what they really need to pay. And they'd include it on a "taxable wage form," because for SOME people, it would be taxable (above a certain threshold in very expensive plans). My honest understanding is that there's nothing in here to include it in "earnings," but rather it will be included as a subset of information on the W-2, much like taxes withheld are, so that people aren't blindsided. And like you, I hope I'm right, because though it won't affect me right now, that'd be way too problematic. But I'd imagine I am right, because for as much as anyone thinks voting for healthcare is political suicide in the first place, if you're right, this is a vote to OUTRIGHT raise every person with employer sponsored healthcare's taxes to a ridiculous degree, and for as stupid as our Pols are, I'm not sure they're THAT stupid. |
http://www.factcheck.org/2010/05/hea...and-w-2-forms/
Q: Does the new health care law require workers to pay income tax on the value of employer-provided health insurance? A: No. The value will appear on employees’ W-2 forms for information purposes, but will not be considered taxable income. The e-mail’s author correctly quotes a Congressional Research Service summary of the bill that became law (H.R. 3590), noting that Section 9002 "Requires employers to include in the W-2 form of each employee the aggregate cost of applicable employer-sponsored group health coverage." But the author then goes on to conclude — quite incorrectly — that this amount will be "added to your gross pay" and that "[y]ou will be taxed on the total." The CRS did not say that, and neither does the legislation itself. In fact, the value will continue to be untaxed, just as in the past. The e-mail’s author also claims that an article written by Joan Pryde, a senior editor of the Kiplinger letters, backs up the claim: "Go to Kiplingers and read about 13 tax changes that could affect you. Number 3 is what I just told you about." But the truth is that the Kiplinger letters actually contradicts the claim. Pryde’s article is dated April 5 and is headlined "Health Care Reform: Tax Hikes on the Way — Here are 13 changes in the massive overhaul that could impact your tax bill, for better or worse." Among them: 3. A requirement that businesses include the value of the health care benefits they provide to employees on W-2s, beginning with W-2s for 2011. The amount reported is not considered taxable income. The author of this false e-mail seems to have missed the second sentence in that paragraph — the part that says the amount "is not considered taxable income." |
i'm pretty sure that if everyones employee provided health insurance was now taxable the death panel crowd would have noticed and headlined it.
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Glad this has all been cleared up, I wasnt so worried for me but I was for my partner, we are lucky that her company includes domestic partners in their health plan which provides me with insurance that I would'nt be able to have otherwise. I still am not seeing the purpose of it being on a W2 but whatever the government knows whats best.
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The first step is to add it to the W-2. Once that happens it is only a matter of time before it becomes taxed.
Plus this will cost businesses money to add this number and because the accuracy is of utmost importance as the initial reasoning behind this is to put the burden of proof that employers are actually providing the required insurance on the employers themselves via the W-2's. The funding mechanism behind the health care plan is seriously flawed and once the reality that it will come up massively short the next step will to be simply tax the benefits as income. |
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This is nothing but pure conjecture. |
I work in health care with physicians. I'm far from an expert on this topic so this is just a guess on my part.
I remember reading that there will be additional taxes for health care insurance companies. The amount being stated on employees' W-2s could be connected to the increased tax the carriers are being asked to pay. It might be that they will use the total cost employers are paying for health care and tie that number back to additional taxes for the insurance companies. The total cost being paid per employee being stated on a W-2 would validate the cost to the employer therefore establishing a real total number to tax the insurance companies on. If this is correct it will be a Catch-22 for insurance companies. The more they charge the higher they are taxed. Not being Pollyanna and just a guess on my part based on what I read about the additional taxes to carriers. Will each of us wind up paying more in the end? Likely.:wf |
i don't see why this would add govt jobs, w-2's already are verified by someone, one more blank to look at shouldn't make a big difference. they probably only verify a percentage.
and i don't see a correlation between adding that line now and a tax on the info later. but maybe i'm just being naive in that degree. they already track income before and then income after 401k deposits, even tho the after is the only one to be taxed at the time. |
is this why they need another 16,000 IRS agents?
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Hundreds of new tax laws are passed every year, the many of them piggybacked on other bills, sometimes in the middle of the night. As you pointed out the opposition to this would be strong which is why it is being phased in gradually. The healthcare bill never would have passed with everybody's heathcare plans being included. Of course the "cadillac" plans are fair game because of those pesky rich people, the definition of which is poorer than it used to be. Anyone who thinks that the govt, the current admisistration especially, isn't going to eventually dig deeper into your pockets to pay for their spending sprees is kidding themselves. |
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A-Carve out a line on the W-2 for the dollar value of your employers plan. The IRS doesn't collect information for informational purposes. The Cadillac plans are already going to be taxed. The rest of us are the next step. |
Linda Bergthold
Health policy consultant Posted: July 10, 2010 04:40 PM Your Health Insurance Will NOT Be Taxed Next Year There is another email making the rounds that claims that the new health reform law requires that you pay taxes on your employer-sponsored health insurance. It's not true. Politifact rates this email "pants on fire" and Snopes also rates this "false." The email says the following: Quote:
The chain e-mail is correct that employers will be required to start listing the cost of insurance. The requirement starts for the tax year 2011, so employees will see it on the W-2s they receive in 2012. But that amount will not be taxed. Current law excludes health insurance from taxable income, and there's nothing in the health care law that changes that. Why is this provision in the law? It is there to assist the IRS in determining who has health insurance and who does not, because when health reform is fully implemented, there will be penalties for people who do not have health insurance and increased taxes starting in 2018 for the so-called "cadillac" plans -- plans that have a value above $10,200 for individuals and $27,500 for family policies. Requiring employers to report the value of the health insurance they provide employees is not a bad idea, by the way. Most people have little idea how much their employer contributes, because they pay only a portion of the premium -- usually around 20 to 30%. The W2 will make it clear just what the value of that insurance is to the employee. If you want an excellent summary of the provisions of the new law, go to the Kaiser Family Foundation (no relation to Kaiser health plans) website and look at the section on "new taxes." As mentioned above, employer provided health insurance is NOT taxable and the law does NOT change that provision. There are no fewer than 4,250 "hits" on Google related to the key words "HR3590 and 2011 W 2 forms". Most of these sites repeat the misrepresentation of this provision in exactly the same words as the original email. Few sites question the accuracy of the information and most are fairly hysterical about it. In fact, I was only able to make it through 8 pages of the Google search before I gave up on websites such as well regulated American militias, swamp bubbles, duck south, and divorce forum. So if you receive this email or hear about it -- pass along the accurate information! |
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-"Your Health Insurance Will NOT Be Taxed Next Year" "next year" is just one year - "Current law excludes health insurance from taxable income, and there's nothing in the health care law that changes that." Yes we know this. But there is nothing to say that it wont be done in the future. 6 months ago, mandatory healthcare wasnt a current law either. - It is there to assist the IRS in determining who has health insurance and who does not, because when health reform is fully implemented, there will be penalties for people who do not have health insurance and increased taxes starting in 2018 for the so-called "cadillac" plans -- plans that have a value above $10,200 for individuals and $27,500 for family policies. Remember the "next year" comment above? The information IS going to be used to tax individuals, just not yet. So in 8 years from now a $10200 policy will still be a cadillac plan? ok. -"employer provided health insurance is NOT taxable and the law does NOT change that provision" yeah THIS one doesn't but as brian pointed out another one could. -"There are no fewer than 4,250 "hits" on Google related to the key words "HR3590 and 2011 W 2 forms". Most of these sites repeat the misrepresentation of this provision in exactly the same words as the original email. Few sites question the accuracy of the information and most are fairly hysterical about it. In fact, I was only able to make it through 8 pages of the Google search before I gave up on websites such as well regulated American militias, swamp bubbles, duck south, and divorce forum. So if you receive this email or hear about it -- pass along the accurate information" Sure only nutjobs are worried that they might be taxed on their benefits because all the sane people trust the IRS to fairly tax them their "just" share. |
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I also think that the IRS has our employers include the amount withheld from our checks because someday down the road they are just going to return that money to us. It's not law yet, but it's pretty easy to see that it's coming. I mean, since we just get to guess and make sh*t up depending on our political view rather than reality on the ground, right? |
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I am not "making anything up". What I am proposing is hardly far fetched and in 2018 it actually comes true "according to law". You see the "cadillac" plans ARE going to be the basis of a tax according to the law. Perhaps you simply want to close your eyes and pretend it won't happen or believe that you are safe because you won't have one of those plans but one thing that is sure is death and taxes and when numbers go onto your W-2, eventually it will be taxed. And when the GOP retakes control, it proves to difficult/impossible to repeal the healthcare debacle, they may be the ones that execute the plan on taxing health benefits. |
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http://www.washingtonpost.com/wp-dyn...061402769.html
"Senate Finance Committee Chairman Max Baucus (D-Mont.) is expected to propose a new tax on the health benefits that millions of Americans currently receive tax-free through employers. Economists say taxing employer-sponsored benefits would help trim runaway health costs and force society to broadly share the burdens of reform. The idea also has bipartisan appeal. Former president George W. Bush and Sen. John McCain (Ariz.), the 2008 GOP presidential candidate, championed a form of the tax; so did Obama advisers Jason Furman and Ezekiel Emanuel before they joined the administration" It didn't happen because it would have kept the bill from passing but those like Brian who think it wont are sadly mistaken. The healthcare bill is funded via accounting tricks and pie in the sky assumptions. It will be woefully underfunded. And when that happens you can expect this to be revisited. |
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Jon Kyl: Extend Bush Tax Cuts For Wealthy Even If They Add To Deficit
Top Senate Republican Jon Kyl (R-Ariz.) insisted on Sunday that Congress should extend the Bush tax cuts for the wealthiest Americans regardless of their impact on the deficit, even as he and other Republicans are blocking unemployment insurance extensions over deficit concerns. "[Y]ou should never raise taxes in order to cut taxes," said the Arizona Senator during an appearance on Fox News Sunday. "Surely Congress has the authority, and it would be right to -- if we decide we want to cut taxes to spur the economy, not to have to raise taxes in order to offset those costs. You do need to offset the cost of increased spending, and that's what Republicans object to. But you should never have to offset cost of a deliberate decision to reduce tax rates on Americans." White House aides immediately seized on the comments. Press Secretary Robert Gibbs wrote on Twitter, "Kyl says wealthy need big Bush tax cuts while middle class families are on their own to fend for themselves as a result of Bush economy." In private, administration officials say that the framing of the argument couldn't be more advantageous: "It's cutting taxes for the wealthy and letting the unemployed to fend for themselves," said one White House ally. "If all of this has a familiar ring to it, it's because unpaid for tax cuts for the rich at the expense of working people is the same backward policy Republicans used to put the nation in this hole, and it's the same policy they promise to return to if put in a position of power again," added Hari Sevugan, press secretary for the Democratic National Committee. |
^^^
Has nothing to do with the subject of the thread |
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And I'm sure that if in one of the countless Sarah Palin threads, I posted something that was critical of Obama or Democrats in general, there would be howls of protest from the usual originator of those threads. |
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Just out of curiosity, if the Republicans win control of both houses of Congress and the White House in 2012, do you think they will mount a full-scale repeal campaign or not? If not....why not? |
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Repealing it will require a plan to replace it. That will take some time to do and we might wind up in a similar mucked filled mess that the current one went through to get passed. Isn't it really a stretch to think that there wont be any meaningful bi-partisan work done in the near future. If I had to guess I would say that they would try to reshape the current plan. Changing the funding mechanisms (and perhaps including the benefits that we are talking about in this thread-especially if the economy is heating up again), undoing the requirement that everyone must participate, granting tax relief to the businesses, etc. If the tea party movement gains more strength and grabs a real hold on some of the power in the party (and the polls favor it), I wouldnt rule out an attempt at a full scale repeal but at this point you would think that is a longer bet than simply tweeking it. |
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Really, you dont think the government can just get a statement from the employer about what they pay for health insurance? Why does it need to be on the employees W2 form? |
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