Many people are unsure how the newly instituted government mandated healthcare will affect their tax situations. The Affordable Healthcare Act will soon be mandated by the IRS. Are you interested in what that means for you? Hopefully we can shed some light on this.
Let’s start with New Medicare taxes. Virtually all employers remove 7.65% of employee wages to support older generations. Nearly 1.5% of this percent is directed to Medicare. The Affordable Care Act will increase the Medicare hospital tax by .9% early this year, applicable to anyone making over $200,000.
Additionally, Healthcare Flex-Spending Accounts will be capped at a total of $2500 with annual deductions once the law takes effect. Prior to Affordable Healthcare, there was no cap. Some are proposing taxpayers should be able to carry over unused amounts but this has yet to be considered law.
Penalties will occur for those who are uninsured. Although such penalties will be capped at a point, they are set to increase if the taxpayer remains without healthcare over several years. The intent here is to progressively stress the importance for all Americans to secure coverage.
Still confused on how Affordable Healthcare will change your tax situation? Talk with an expert.