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Ring in the New Year with your New Healthcare Taxes

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Most of the new healthcare taxes will fall on high income earners, but the middle class and medical device industry will also take a hit.

Directly impacting taxpayers is the Medicare tax hike on high income wage earners, higher taxes on investment income, lower contributions to flexible spending accounts and a higher threshold for deducting medical expenses from income tax. 

The Affordable Health Care Act is funded through the Medicare taxes of high income earners. These taxes hit individuals earning over $200,000, and joint filers earning more than $250,000.  Medicare taxes will go up by .9% for these folks and they will be hit with an additional 3.8% on unearned income.

Also hit will be folks who earn a greater share of their income from investments. Even if their regular income isn't high enough for the additional taxes, their investment income would be hit with an additional 4% tax. The consequence will most likely be less investment.

The cost of the Affordable Healthcare Act will not just hit the "rich." Two new taxes will affect the middle-class. Taxpayers used to be able to deduct health care expenses that total more than 7.5% of their income. Starting in 2013, that threshold will rise to 10%. This deduction is most often utilized by lower income earners with high medical bills.

According to Lindsey Buchholz of the H&R Block Tax Institute, about 10 million taxpayers deduct around $80 billion in health care expenses a year.

via www.breitbart.com

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