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William Byrnes (Texas A&M) tax & compliance articles

Posts Tagged ‘Obama Care’

Obtaining and Claiming a Health Coverage Exemption

Posted by William Byrnes on March 2, 2015


In its 9th Health Care Tax Tip, the IRS emphasized how a taxpayer may obtain and claim exemption from health care coverage required by law under the 9dc30-6a00d8341bfae553ef01bb07b43355970d-piAffordable Care Act (Obama Care).  The Affordable Care Act requires you and each member of your family to have minimum essential coverage, qualify for an insurance coverage exemption, or make an individual shared responsibility payment when you file your federal income tax return.

If a taxpayer meets certain criteria, then the taxpayer may claim to be exempt from the requirement to have “qualifying health coverage”.  If the taxpayer is found to be exempt, then the taxpayer will not have to pay the tax penalty called a “shared responsibility payment” when filing the 2014 federal income tax return.  But for any month that the taxpayer does not qualify for the exemption, then the taxpayer will need to have minimum essential coverage for that month or pay a month’s worth of penalty.

A taxpayer may seek exemption from coverage depending upon the type of exemption for which the taxpayer may be eligible.  A taxpayer can obtain some exemptions only from the Health Care Marketplace, while others exemptions may be claimed when filing the annual tax return.

A taxpayer may be exempt if:

  • The minimum amount for the annual premium is more than eight percent of the taxpayer’s household income
  • The Taxpayer has a gap in coverage that is less than three consecutive months
  • A taxpayer may qualify for an exemption for one of several other reasons, including having a hardship that prevents the taxpayer from obtaining coverage, or belonging to a group explicitly exempt from the requirement

A taxpayer must claim or report coverage exemptions on Form 8965, Health Coverage Exemptions, and attach it to Form 1040, Form 1040A, or Form 1040EZ.

Health Care Marketplace Exemption Certificate Number If a coverage exemption is granted from the Health Care Marketplace, then the Market Place will send a notice with a unique Exemption Certificate Number (ECN).  The taxpayer must enter the ECN in Part I, Marketplace-Granted Coverage Exemptions for Individuals, of Form 8965 in column C.  If the Marketplace has not sent the ECN before a taxpayer files a tax return, then the taxpayer must complete Part I of Form 8965 and enter “pending” in Column C for each person listed.

If a taxpayer claims the exemption on the tax return, then the taxpayer does not need an ECN from the Marketplace.  With the tax filing season underway, most exemptions for 2014 are only available by claiming them on the tax return.

If the taxpayer’s income is below the tax filing threshold and thus the taxpayer is not required to file a tax return, then the taxpayer is eligible for an exemption and does not have to file a tax return to claim it.  But if the taxpayer chooses to file a tax return, the taxpayer must use Part II, Coverage Exemptions for Your Household Claimed on Your Return, of Form 8965 to claim a health coverage exemption.

Other IRS-granted coverage exemptions may be claimed on your tax return using Part III, Coverage Exemptions for Individuals Claimed on Your Return, of Form 8965.

Tax Facts on Individuals & Small Business

2014_tf_on_individuals_small_businesses-m_1Due to a number of recent changes in the law, taxpayers are currently facing many questions connected to important issues such as healthcare, home office use, capital gains, investments, and whether an individual is considered an employee or a contractor.  Financial advisors are continually looking for competitive information to help them provide the best answers for their clients and to obtain new clients.  National Underwriter’s Tax Facts series is the only resource written specifically for the financial advisor and producer providing fast, clear, and authoritative answers to pressing questions, and it does so in the convenient, timesaving, Q&A format for which Tax Facts has been famous over 50 years.

Anyone interested can try Tax Facts Online risk-free for 30 days, with a 100% guarantee of complete satisfaction.  Call 1-800-543-0874.

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Health Care Law Brings Changes to IRS Tax Forms

Posted by William Byrnes on January 14, 2015


The IRS announced that the tax forms for the 2014 tax year have some dramatic modifications to allow for enforcement of Obama Care (aka the “Affordable Care Act” and “ACA”).

Existing forms have new lines integrated and the IRS has created two new forms that some taxpayers must now file with the tax return.

Many taxpayers will only need to check a box on their tax return if they had the requisite health coverage for all of 2014 as require by the ACA so as to avoid penalties.  Forms 1040, 1040A, and 1040EZ also have new lines to complete related to the health care law.

Two New Tax Forms for Taxpayers 

Form 8965, Health Coverage Exemptions

  • Complete this form to report a Marketplace-granted coverage exemption or claim an IRS-granted coverage exemption on the return.
  • Use the worksheet in the Form 8965 Instructions to calculate the shared responsibility payment.

Form 8962, Premium Tax Credit

  • Complete this form to reconcile advance payments of the premium tax credit, and to claim this credit on the tax return.

Additionally, if individuals purchased coverage through the Health Insurance Marketplace, they should receive Form 1095-A, Health Insurance Marketplace Statement, which will help complete Form 8962.

Modifications of Existing 2014 Tax Forms

Form 1040

  • Line 46: Enter advance payments of the premium tax credit that must be repaid
  • Line 61: Report health coverage and enter individual shared responsibility payment
  • Line 69: If eligible, claim net premium tax credit, which is the excess of allowed premium tax credit over advance credit payments

Form 1040A

  • Line 29: Enter advance payments of the premium tax credit that must be repaid
  • Line 38: Report health coverage and enter individual shared responsibility payment
  • Line 45: If eligible, claim net premium tax credit, which is the excess of allowed premium tax credit over advance credit payments

Form 1040EZ

  • Line 11: Report health coverage and enter individual shared responsibility payment
  • Form 1040EZ cannot be used to report advance payments or to claim the premium tax credit

Tax Facts on Individuals & Small Business

2014_tf_on_individuals_small_businesses-m_1Due to a number of recent changes in the law, taxpayers are currently facing many questions connected to important issues such as healthcare, home office use, capital gains, investments, and whether an individual is considered an employee or a contractor.  Financial advisors are continually looking for competitive information to help them provide the best answers for their clients and to obtain new clients.  National Underwriter’s Tax Facts series is the only resource written specifically for the financial advisor and producer providing fast, clear, and authoritative answers to pressing questions, and it does so in the convenient, timesaving, Q&A format for which Tax Facts is famous.

Anyone interested can try Tax Facts on Individuals & Small Business, risk-free for 30 days, with a 100% guarantee of complete satisfaction.  For more information, please go to http://www.nationalunderwriter.com/2015-tax-facts-on-individuals-small-business.html or call 1-800-543-0874.

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11 health insurance tax facts a taxpayer needs to know about

Posted by William Byrnes on June 24, 2014


Employers and those who advise them may have questions about what expenses qualify for deductions, which tax credits they can take advantage of, and what the new rules mean for grandfathered plans. Individuals may be wondering how HSA distributions are taxed, or whether benefits received under a personal health insurance policy are taxable. 

1. Are premiums paid for personal health insurance deductible as medical expenses?

2. May an employer deduct as a business expense the cost of premiums paid for accident and health insurance for employees?

3. What credit is available for small employers for employee health insurance expenses?

4. Are benefits received under a personal health insurance policy taxable income?

5. How is employer-provided disability income coverage taxed?

6. How is personal disability income coverage taxed?

William Byrnes and Robert Bloink have the well-researched answers you’re looking for on LifeHealthPro !

 


If you are interested in discussing the Master or Doctoral degree in the areas of financial planning, please contact me: profbyrnes@gmail.com to Google Hangout or Skype that I may take you on an “online tour” 

 

 

Posted in Taxation, Uncategorized | Tagged: , , , | Leave a Comment »

Do you Owe a Health Care Coverage Penalty for 2014?

Posted by William Byrnes on June 20, 2014


Deadline to Enroll has Passed

The deadline to enroll in minimum essential health insurance passed on March 30, 2014.   According to estimates by the Federal Department of Health and Human Services (HHS), it met its goal of at least 7 million persons enrolling for health care via the health insurance market places established by the federal government on behalf of various states. Some states, such as California, established their own insurance marketplaces, and thus it is likely that the 7 million figure has indeed been achieved, if not surpassed.

Did Enough Healthy People Enroll to Pay for The System?

The primary question for the federal government that remains is whether the balance of persons enrolling that are “healthy” individuals who must simply pay the annual premium in 2014 but will not actually take dollars from the medical coverage in 2014, will outweigh the payouts to individuals that will take more from health insurance than they pay in.

But What About the Medicaid Expansion?

Moreover, the Affordable Care Act pushed states to expand the definition of when an individual may be covered by the Medicaid, and thus receive medical care substantively paid for by a combination of the federal and state government.  The federal government upfront will provide 90% of a state’s additional medicare cost.  The state must shoulder more of this burden in the future though.

How Will This Be Paid For?

How will the federal government pay for its share of the additional medicare costs and for any additional costs associated with this new federally mandated system?  Some government officials state that Obama Care is already set up to pay for itself because the medical profession, insurance companies, and taxpayers will pick up the additional costs.  Insurance companies will reduce their own administrative costs, the medical profession will offer its services at cheaper prices, and Congress has already raised taxes in the forms of the increased medicare payroll tax and medicare tax on investment income.

The New “Shared Responsibility Payment” Tax, Penalty, Fine

But also, Congress imposed a required payment (some pundits call it a penalty, some call it a tax, others a fine like a parking ticket) on taxpayers who do not obtain and maintain health coverage, that will over time increase.  As the required penalty increases over the coming years, in principle at least, it should be cheaper for a taxpayer to simply buy the lowest cost health insurance than to pay this penalty.  This assumes that the cost of the lowest quality health insurance in these marketplaces does not sky rocket to over come the penalty.

Congress did not call the penalty a “penalty” in the actual law. Instead, Congress used a more ‘voter friendly’ expression “individual shared responsibility payment”.

An Example Decision Maker Deciding What to do in 2014

Other factors will play a role in this decision process, such as a individual’s appetite to take on catastrophic medical risk  (like breaking all their bones in an accident) and weighing the cost of the insurance and the required deductible. If an individual’s annual premium will cost by example approximately $7,200 and the annual deductible is $6,000 (this is an actual example from an insurance policy offered via the 2014 California Marketplace), and the individual thinks that it is extremely unlikely that he or she will spend more than $13,200 in medical costs in 2014, then the individual may opt for the “shared responsibility payment”.

If nothing medically happens during 2014, the taxpayer will only owe the contribution, and thus have saved over $13,000!  However, if something catastrophic happens in 2014 requiring substantial medical expenses over $13,200, the taxpayer will have been better off with the insurance.  Another economic factor in this economic decision making process includes the amount of co-pay required per type of medical procedure.  Another factor in the risk decision making process is the individual’s belief of potentially requiring a certain level of medical expenses, such as perhaps just a stomach virus and the likely out of pocket cost of that care, versus breaking a bone.

How much is the penalty for 2014 if a taxpayer did not have “minimum essential coverage’ by March 30, 2014?

If a taxpayer (or any dependents) do not maintain health care coverage and do not qualify for an exemption, then the taxpayer must make an individual shared responsibility payment with the 2014 tax return.  In general, this health care coverage penalty is either a percentage of the taxpayer’s income or a flat dollar amount, whichever is greater.  High income taxpayers will pay a higher penalty.  A taxpayer will owe 1/12th of this penalty for each month of the taxpayer or taxpayer’s dependents gap in coverage.  The annual payment amount for 2014 is the greater of:

  • one percent (1%) of the household income that is above the tax return threshold for the taxpayer’s filing status, such as Married Filing Jointly or single, or
  • a family’s flat dollar amount, which is $95 per adult and $47.50 per child, limited to a maximum of $285.

This individual shared responsibility payment is capped at the cost of the national average premium for the bronze level health plan available through the Marketplace in 2014.  The taxpayer will pay the due amount with the 2014 federal income tax return filed in 2015.  For example, a single adult under age 65 with household income less than $19,650 (but more than $10,150) would pay the $95 flat rate.  However, a single adult under age 65 with household income greater than $19,650 would pay an annual payment based on the one percent rate.  

Why greater than $19,650?  The filing threshold for a single adult in 2014 is 10,150, subtract that from $19,650, leaving a base amount of $9, 500.  Multiply 1% to that base amount and the penalty is $95, the same as the flat rate.

So, from the beginning of this year (January 1, 2014) a taxpayer and the family must either have “qualifying” health insurance coverage throughout the year, qualify for an exemption from coverage, or make the above payment when filing the 2014 federal income tax return in 2015.

What is “Minimum Essential Coverage” Under the Affordable Care Act (“ACA”)?

In Health Care Tax Tip 12, the IRS explained for a taxpayer how to determine if his or her health care coverage qualifies as “minimum essential coverage” to avoid the health care coverage penalty for 2014 that must be paid by April 15, 2015 when filing the tax return.

The Affordable Care Act calls for individuals to have and maintain qualifying health insurance coverage for each month of the year, or have an exemption, or make a shared responsibility payment (pay a ‘penalty’) when filing their federal income tax return next year by April 15, 2015.

Qualifying health insurance coverage, called minimum essential coverage, includes coverage under various, but not all, types of health care coverage plans. The IRS stated that the majority of coverage that people have today counts as minimum essential coverage.

The IRS provided examples of minimum essential coverage:

  • Health insurance coverage provided by an employer,
  • Health insurance purchased through the Health Insurance Marketplace,
  • Coverage provided under a government-sponsored program (including Medicare, Medicaid, and health care programs for veterans), and
  • Health insurance purchased directly from an insurance company.

Minimum essential coverage does not include coverage providing only limited benefits, such as:

  • Coverage consisting solely of excepted benefits, such as:
    • Stand-alone vision and dental insurance
    • Workers’ compensation
    • Accident or disability income insurance
  • Medicaid plans that provide limited coverage such as only family planning services or only treatment of emergency medical conditions.

tax-facts-online_medium

Due to a number of recent changes in the law, taxpayers are currently facing many questions connected to important issues such as healthcare, home office use, capital gains, investments, and whether an individual is considered an employee or a contractor. Financial advisors are continually looking for updated tax information that can help them provide the right answers to the right people at the right time. This brand-new resource provides fast, clear, and authoritative answers to pressing questions, and it does so in the convenient, timesaving, Q&A format for which Tax Facts is famous.

Our brand-new Tax Facts title is exciting in many ways,” says Rick Kravitz, Vice President & Managing Director of Summit Professional Network’s Professional Publishing Division. “First of all, it fills a huge gap in the resources available to today’s advisors. Small business is a big market, and this book enables advisors to get up-and-running right away, with proven guidance that will help them serve their clients’ needs. Secondly, it addresses the biggest questions facing all taxpayers and provides absolutely reliable answers that help advisors solve today’s biggest problems with confidence.”

Robert Bloink, Esq., LL.M., and William H. Byrnes, Esq., LL.M., CWM®—are delivering real-life guidance based on decades of experience.  The authors’ knowledge and experience in tax law and practice provides the expert guidance for National Underwriter to once again deliver a valuable resource for the financial advising community,” added Rick Kravitz.

Anyone interested can try Tax Facts on Individuals & Small Business, risk-free for 30 days, with a 100% guarantee of complete satisfaction.  For more information, please go to www.nationalunderwriter.com/TaxFactsIndividuals or call 1-800-543-0874.

Posted in Taxation | Tagged: , , , | Leave a Comment »

Do I Owe an Obama Care “Individual Shared Responsibility Payment” with my next tax return?

Posted by William Byrnes on April 30, 2014


The IRS, in its Health Care Tax Tip 2014-04, addressed the question of whether a taxpayer owes an Obama Care Tax Penalty (or “Fee” or as it is formally known an “Individual Shared Responsibility Payment”) to be paid with the 2014 tax return filed by April 15, 2015.  What ever it is referred to, being a penalty, a fee, or a payment, it is mandatory and was fairly imposed by Congress, with a supra majority Senate vote.  

So … the question is: Do I owe it?  And if so, how much do I owe? 

The short answer is that for any month in 2014 that a taxpayer or any of a taxpayer’s dependents do n0t maintain health care coverage and do not qualify for an exemption from having health care coverage, then the taxpayer will owe an “individual shared responsibility payment” with your 2014 tax return filed in 2015 (exemption is the same as exception, and in tax it is said that there is always an exception to a rule, and an exception to the exception).  

What is the “less than three-month gap” exemption / exception?

The exception is if a taxpayer went without health care coverage for less than three consecutive months during the year, then the taxpayer may qualify for the short coverage gap exemption and will not have to make a payment for those months. However, if a taxpayer has more than one short coverage gap during a year, the short coverage gap exemption only applies to the first.  So by example, the taxpayer has health care coverage January 1, 2014 until February 28, and May 1 until August 30, and then again from November 15 through December 31, 2014.  The first health care coverage gap that falls within the exception is March 1 until April 30 because it is less than three consecutive months.  The second gap in coverage is also less than three consecutive months, being September 1 through November 15 – but the exception has already been used for the year so it does not fall within it.

How much does a taxpayer owe?

If a taxpayer (or any dependents) do not maintain health care coverage and do not qualify for an exemption, then the taxpayer must make an individual shared responsibility payment with the 2014 tax return.  In general, this health care coverage penalty is either a percentage of the taxpayer’s income or a flat dollar amount, whichever is greater.  High income taxpayers will pay a higher penalty.  A taxpayer will owe 1/12th of this penalty for each month of the taxpayer or taxpayer’s dependents gap in coverage.  The annual payment amount for 2014 is the greater of:

  • one percent (1%) of the household income that is above the tax return threshold for the taxpayer’s filing status, such as Married Filing Jointly or single, or
  • a family’s flat dollar amount, which is $95 per adult and $47.50 per child, limited to a maximum of $285.

This individual shared responsibility payment is capped at the cost of the national average premium for the bronze level health plan available through the Marketplace in 2014.  The taxpayer will pay the due amount with the 2014 federal income tax return filed in 2015.  For example, a single adult under age 65 with household income less than $19,650 (but more than $10,150) would pay the $95 flat rate.  However, a single adult under age 65 with household income greater than $19,650 would pay an annual payment based on the one percent rate.  

Why greater than $19,650?  The filing threshold for a single adult in 2014 is 10,150, subtract that from $19,650, leaving a base amount of $9, 500.  Multiply 1% to that base amount and the penalty is $95, the same as the flat rate.

So, from the beginning of this year (January 1, 2014) a taxpayer and the family must either have “qualifying” health insurance coverage throughout the year, qualify for an exemption from coverage, or make the above payment when filing the 2014 federal income tax return in 2015.

What qualifies as “qualifying health insurance coverage”?

Qualifying coverage includes coverage provided by an employer, health insurance purchased in the Health Insurance Marketplace, most government-sponsored coverage, and coverage purchased directly from an insurance company.  However, qualifying coverage does not include coverage that may provide limited benefits, such as coverage only for vision care or dental care, workers’ compensation, or coverage that only covers a specific disease or condition.

What are the exemptions to obtaining or maintaining required health care coverage?

A taxpayer may be exempt from the requirement to maintain qualified coverage if:

  • Have no affordable coverage options because the minimum amount a taxpayer must pay for the annual premiums is more than eight percent (8%) of household income,
  • Have a gap in coverage for less than three consecutive months (see abo0ve), or
  • Qualify for an exemption for one of several other reasons, including having a hardship that prevents the taxpayer from obtaining coverage, or belonging to a group explicitly exempt from the requirement.
  • A special hardship exemption applies to taxpayers who purchase their insurance through the Marketplace during the initial enrollment period for 2014 but due to the enrollment process have a coverage gap at the beginning of 2014.

tax-facts-online_medium

Due to a number of recent changes in the law, taxpayers are currently facing many questions connected to important issues such as healthcare, home office use, capital gains, investments, and whether an individual is considered an employee or a contractor. Financial advisors are continually looking for updated tax information that can help them provide the right answers to the right people at the right time. This brand-new resource provides fast, clear, and authoritative answers to pressing questions, and it does so in the convenient, timesaving, Q&A format for which Tax Facts is famous.

Our brand-new Tax Facts title is exciting in many ways,” says Rick Kravitz, Vice President & Managing Director of Summit Professional Network’s Professional Publishing Division. “First of all, it fills a huge gap in the resources available to today’s advisors. Small business is a big market, and this book enables advisors to get up-and-running right away, with proven guidance that will help them serve their clients’ needs. Secondly, it addresses the biggest questions facing all taxpayers and provides absolutely reliable answers that help advisors solve today’s biggest problems with confidence.”

Robert Bloink, Esq., LL.M., and William H. Byrnes, Esq., LL.M., CWM®—are delivering real-life guidance based on decades of experience.  The authors’ knowledge and experience in tax law and practice provides the expert guidance for National Underwriter to once again deliver a valuable resource for the financial advising community,” added Rick Kravitz.

Anyone interested can try Tax Facts on Individuals & Small Business, risk-free for 30 days, with a 100% guarantee of complete satisfaction.  For more information, please go to www.nationalunderwriter.com/TaxFactsIndividuals or call 1-800-543-0874.

 

If you are interested in discussing the Master or Doctorate degree in the areas of financial services or international taxation, please contact me https://profwilliambyrnes.com/online-tax-degree/

Posted in Taxation | Tagged: , , , , | Leave a Comment »

Must a taxpayer report the value of his/her employer-sponsored health insurance coverage included on the W2?

Posted by William Byrnes on April 10, 2014


In its Health Care Tax Tip 2014-09, the IRS answered the question:  Must a taxpayer report on the income tax return (form 1040) the value of his/her employer-sponsored health insurance coverage?  The employer has included the cost of the employer-sponsored health insurance coverage on an employee’s W-2, Wage and Tax Statement.  What must a taxpayer do with this information?

The Affordable Care Act requires employers to report the cost of coverage under an employer-sponsored group health plan. Reporting the cost of health care coverage on the Form W-2 does not mean that the coverage is taxable. The value of the employer’s excludable contribution to health coverage continues to be excludable from an employee’s income, and it is not taxable. This reporting is for informational purposes only and will provide employees useful and comparable consumer information on the cost of their health care coverage.

Employers that provide “applicable employer-sponsored coverage” under a group health plan are subject to the reporting requirement. This includes businesses, tax-exempt organizations, and federal, state and local government entities (except with respect to plans maintained primarily for members of the military and their families). However, federally recognized Indian tribal governments are not subject to this requirement.  See Form-W-2-Reporting-of-Employer-Sponsored-Health-Coverage

Here is what the IRS stated about the amount shown on the W-2 “employer-sponsored health insurance coverage”.

  • The health care law requires certain employers to report the cost of coverage under an employer-sponsored group health plan.
  • The amount of employer-sponsored health insurance coverage appears in Box 12 of the W-2, and has the code letters “DD” next to it.
  • Reporting the cost of health care coverage on the Form W-2 does not mean that the coverage is taxable or that it needs to be reported on the tax return.
  • The amount in Box 12 is only for government information collection only, and shows the payments made by the taxpayer and the employer and is not included in the amount shown in Box 1, which is the amount of taxable earnings.

Reporting on the Form W-2

The value of the health care coverage will be reported in Box 12 of the Form W-2, with Code DD to identify the amount. There is no reporting on the Form W-3 of the total of these amounts for all the employer’s employees.

In general, the amount reported should include both the portion paid by the employer and the portion paid by the employee. See the chart, below, and the questions and answers for more information.

An employer is not required to issue a Form W-2 solely to report the value of the health care coverage for retirees or other employees or former employees to whom the employer would not otherwise provide a Form W-2.

Form W-2 Reporting of Employer-Sponsored Health Coverage

Coverage Type

Form W-2, Box 12, Code DD

Report

Do Not Report

Optional

Major medical

X

Dental or vision plan not integrated into another medical or health plan

X

Dental or vision plan which gives the choice of declining or electing and paying an additional premium

X

Health Flexible Spending Arrangement (FSA) funded solely by salary-reduction amounts

X

Health FSA value for the plan year in excess of employee’s cafeteria plan salary reductions for all qualified benefits

X

Health Reimbursement Arrangement (HRA) contributions

X

Health Savings Arrangement (HSA) contributions (employer or employee)

X

Archer Medical Savings Account (Archer MSA) contributions (employer or employee)

X

Hospital indemnity or specified illness (insured or self-funded), paid on after-tax basis

X

Hospital indemnity or specified illness (insured or self-funded), paid through salary reduction (pre-tax) or by employer

X

Employee Assistance Plan (EAP) providing applicable employer-sponsored healthcare coverage

Required if employer charges a COBRA premium

Optional if employer does not charge a COBRA premium

On-site medical clinics providing applicable employer-sponsored healthcare coverage

Required if employer charges a COBRA premium

Optional if employer does not charge a COBRA premium

Wellness programs providing applicable employer-sponsored healthcare coverage

Required if employer charges a COBRA premium

Optional if employer does not charge a COBRA premium

Multi-employer plans

X

Domestic partner coverage included in gross income

X

Governmental plans providing coverage primarily for members of the military and their families

X

Federally recognized Indian tribal government plans and plans of tribally charted corporations wholly owned by a federally recognized Indian tribal government

X

Self-funded plans not subject to Federal COBRA

X

Accident or disability income

X

Long-term care

X

Liability insurance

X

Supplemental liability insurance

X

Workers’ compensation

X

Automobile medical payment insurance

X

Credit-only insurance

X

Excess reimbursement to highly compensated individual, included in gross income

X

Payment/reimbursement of health insurance premiums for 2% shareholder-employee, included in gross income

X

Other Situations

Report

Do Not Report

Optional

Employers required to file fewer than 250 Forms W-2 for the preceding calendar year (determined without application of any entity aggregation rules for related employers)

X

Forms W-2 furnished to employees who terminate before the end of a calendar year and request, in writing, a Form W-2 before the end of that year

X

Forms W-2 provided by third-party sick-pay provider to employees of other employers

X

The chart was created at the suggestion of and in collaboration with the IRS’ Information Reporting Program Advisory Committee (IRPAC). IRPAC’s members are representatives of industries responsible for providing information returns, such as Form W-2, to the IRS. IRPAC works with IRS to improve the information reporting process.

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Employers Face Stiff Obama Care Excise Taxes (aka Penalties)

Posted by William Byrnes on April 4, 2014


The Affordable Health Care Act (ACA) (“Obama Care”) may lead to stiff excise taxes for midsize and larger employers that misclassify employees as independent contractors (see §4980H Shared responsibility for employers regarding health coverage).  The term “applicable large employer” means, with respect to a calendar year, an employer who employed an average of at least 50 full-time employees on business days during the preceding calendar year.  The term “full-time employee” means, with respect to any month, an employee who is employed on average at least 30 hours of service per week.  However, employers with less than a 100 employees have a transition period until 2016 for the application of §4980H.

Employers that misclassify employees as independent contractors already face potential tax liability and tax penalties for each misclassified employee.  In addition to these current potential liabilities and penalties for misclassification, employers will now face excise tax assessments under the ACA.   This new excise tax is $2,000 per employee not covered by a qualifying employer medical plan.  However, to encourage compliance with the ACA, if less than 95% of the employees of an employer are covered by a qualified medical employer plan, then a stiffer penalty of $2,000 for every employee of the company may be imposed, albeit with an exemption of the excise tax applying to the first 30 employees.

By example, an employer has 50 workers of which the employer has classified 80% (40) as employees and the remaining 20% (10) as independent contractors.  The employer provides a medical insurance plan for the 40 employees that qualifies for purposes of the ACA.  The §4980H issue is moot, meaning it does not need to be considered, because the employer does not reach the minimum 50 employee threshold.  But now the problem …

The IRS audits the employer and determines that the employer has misclassified the 10 independent contractors, and re-classifies them as employees.  The employer has employment tax issues, and penalties to contend with, regarding the 10 employees.  But also, §4980H now applies because the employer has reached 50 employees.  Worse yet, the employer has not covered 95% of its employees with qualified medical coverage.  Instead of 40 employees covered out of 40 covered for 100% coverage, after audit the employer is determined to have only covered 80% of employees (40 out of 50), missing the minimum 95% threshold.   Thus, the excise tax does not apply to just the 10 employees but instead applies to all employees, with an allowance for the first 30.  How much excise tax will be owed then?  50 employees, subtracting the allowance for the first 30, leaves 20 employees multiplied by the excise  tax of $2,000, thus $40,000 for the year (on top of normal employment taxes and penalties for the 10 misclassified employees).

Classification of a worker as either an “employee” or an “independent contractor” is based on the common law standard of an examination of the facts and circumstances of the relationship between the employer and the worker to assess whether the employer has the right to direct and control the performance of services.  Substantial case law has developed from disputes between employers and the IRS, and between workers, who may want to be classified as independent contractors to better leverage tax deductions, and the IRS.

tax-facts-online_medium

Due to a number of recent changes in the law, taxpayers are currently facing many questions connected to important issues such as healthcare, home office use, capital gains, investments, and whether an individual is considered an employee or a contractor. Financial advisors are continually looking for updated tax information that can help them provide the right answers to the right people at the right time. This brand-new resource provides fast, clear, and authoritative answers to pressing questions, and it does so in the convenient, timesaving, Q&A format for which Tax Facts is famous.

“Our brand-new Tax Facts title is exciting in many ways,” says Rick Kravitz, Vice President & Managing Director of Summit Professional Network’s Professional Publishing Division. “First of all, it fills a huge gap in the resources available to today’s advisors. Small business is a big market, and this book enables advisors to get up-and-running right away, with proven guidance that will help them serve their clients’ needs. Secondly, it addresses the biggest questions facing all taxpayers and provides absolutely reliable answers that help advisors solve today’s biggest problems with confidence.”

Robert Bloink, Esq., LL.M., and William H. Byrnes, Esq., LL.M., CWM®—are delivering real-life guidance based on decades of experience.  The authors’ knowledge and experience in tax law and practice provides the expert guidance for National Underwriter to once again deliver a valuable resource for the financial advising community,” added Rick Kravitz.

Anyone interested can try Tax Facts on Individuals & Small Business, risk-free for 30 days, with a 100% guarantee of complete satisfaction.  For more information, please go to www.nationalunderwriter.com/TaxFactsIndividuals or call 1-800-543-0874.

Posted in Compliance, Taxation | Tagged: , , , , , , | Leave a Comment »

Today is the deadline to sign up for health care (or face penalties)

Posted by William Byrnes on March 31, 2014


In Health Care Tax Tip 2014-11 the IRS reminds taxpayers that today, March 31, is the deadline to sign up for health care for 2014 – or face penalties.

Below are five tips about the Obama Care (ACA) health care law that the IRS wants taxpayers to consider.

• Currently Insured – No Change: If a taxpayer is already insured, do not need to do anything more than continue that insurance.

• Uninsured – Enroll by Today – March 31: The open enrollment period to purchase health care coverage through the Health Insurance Marketplace for 2014 runs through March 31, 2014. When a taxpayer chooses health insurance through the marketplace, the taxpayer may be able to receive advance payments of the premium tax credit that will immediately help lower the monthly premium.

• Premium Tax Credit To Lower the Monthly Premium: If a taxpayer chooses insurance through the Marketplace, the taxpayer may be eligible to claim the premium tax credit. The taxpayer may elect to have advance payments of the tax credit sent directly to the insurance company during 2014 so that the monthly premium the taxpayer must pay is lower, or the taxpayer can wait to claim the credit when filing the tax return in 2015.  If a taxpayer chooses to have advance payments sent to the insurance company, then the taxpayer must reconcile the payments on the 2014 tax return, which will be filed in 2015.

• Change in Circumstances: If a taxpayer receives advance payments of the premium tax credit to help pay for the insurance coverage, then the taxpayer must report “life changes”, such as income, marital status or family size changes, to the Marketplace. Reporting changes will help to make sure the taxpayer has the right coverage and is getting the proper amount of advance payments of the premium tax credit.

• Individual Shared Responsibility Payment: Starting January 2014, taxpayers and the family must have health care coverage or have an exemption from coverage.  Most people already have qualifying health care coverage.  These individuals will not need to do anything more than maintain that coverage throughout 2014.  If a taxpayer can afford coverage but decides not to buy it and remain uninsured throughout the year, that taxpayer may have to make an “individual shared responsibility payment” (a.k.a. the ACA penalty) when filing a 2014 tax return in 2015.

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Small Business Health Care Tax Credit

Posted by William Byrnes on March 30, 2014


2013_tf_insurance_emp_benefits_combo_covers-m_2In the IRS’ Health Care Tax Tip (HCTT-2014-08), it revealed that the “Small Business Health Care Tax Credit” helps small businesses and tax-exempt organizations pay for health care coverage they offer their employees.

A small employer is eligible for the credit if it has fewer than 25 employees who work full-time, or a combination of full-time and part-time. For example, two half-time employees equal one employee for purposes of the credit.

For 2013, the average annual wages of employees must be less than $50,000, and the employer must pay a uniform percentage for all employees that is equal to at least 50% of the premium cost of the insurance coverage.

The maximum credit is 35 percent of premiums paid for small business employers and 25 percent of premiums paid for small tax-exempt employers such as charities.

If no tax is owed during the year, then the tax credit may be carried back or forward to other tax years.

For small tax-exempt employers, the credit is refundable, so even if no taxable income is due, the credit may be refunded so long as it does not exceed the income tax withholding and Medicare tax liability.

Authoritative and easy-to-use, 2014 Tax Facts on Insurance & Employee Benefits shows you how the tax law and regulations are relevant to your insurance, employee benefits, and financial planning practices.  Often complex tax law and regulations are explained in clear, understandable language.  Pertinent planning points are provided throughout.

Organized in a convenient Q&A format to speed you to the information you need, 2014 Tax Facts on Insurance & Employee Benefits delivers the latest guidance on:

  • Estate & Gift Tax Planning
  • Roth IRAs
  • HSAs
  • Capital Gains, Qualifying Dividends
  • Non-qualified Deferred Compensation Under IRC Section 409A
  • And much more!

Key updates for 2014:

  • Important federal income and estate tax developments impacting insurance and employee benefits including changes from the American Taxpayer Relief Act of 2012
  • Concise updated explanation and highlights of the Patient Protection and Affordable Care Act (PPACA)
  • Expanded coverage of Annuities
  • New section on Structured Settlements
  • New section on International Tax
  • More than thirty new Planning Points, written by practitioners for practitioners, in the following areas:
    • Life Insurance
    • Health Insurance
    • Estate and Gift Tax
    • Deferred Compensation
    • Individual Retirement Plans

Plus, you’re kept up-to-date with online supplements for critical developments.  Written and reviewed by practicing professionals who are subject matter experts in their respective topics, Tax Facts is the practical resource you can rely on.

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IRS Reminds Individuals of Health Care Choices for 2014

Posted by William Byrnes on March 28, 2014


In Issue Number HC-TT- 2014-01, the IRS released reminders for Individuals about the 2014 Health Care Choices.  In 3 days, on March 31, the Heath Care Market Exchange enrollment period will close.

Starting in 2014, each person must choose to either have basic health insurance coverage (known as minimum essential coverage) for everyone in the family for each month or go without health care coverage for some or all of the year.

If a person don’t maintain health insurance coverage, then that person will need to either seek an exemption or pay a penalty (called an “individual shared responsibility payment”) with the 2014 income tax return filed in 2015. 

What Qualifies as Health Insurance to Avoid the Penalty?

Qualifying coverage includes:

  • health insurance coverage provided by your employer (including COBRA and retiree coverage),
  • health insurance coverage purchase through a health care exchange Marketplace,
  • Medicare, Medicaid or other government-sponsored health coverage including programs for veterans, or
  • coverage you buy directly from an insurance company.

Qualifying coverage does not include certain coverage that may provide limited benefits, such as coverage only for vision care or dental care, workers’ compensation, or coverage only for a specific disease or condition. 

Premium Tax Credit May Help Pay for Health Insurance

If purchasing health insurance coverage through the Marketplace, the person may be eligible for financial assistance including the premium tax credit, which will help lower the out-of-pocket cost of your monthly insurance premiums (see yesterday’s blog article).

Exemptions

If a person chooses to go without coverage or experiences a gap in coverage, the person may still qualify for an exemption based upon (1) not having access to affordable coverage, (2) the gap is less than three consecutive months without coverage, or (3) qualifying for one of several other exemptions.  A special hardship exemption applies to individuals who purchase their insurance through the Marketplace during the initial enrollment period but due to the enrollment process have a coverage gap at the beginning of 2014.

Penalty for Not Having Health Insurance

If a person (or any of dependents) do not maintain coverage and do not qualify for an exemption, then the person will owe a penalty, called a “individual shared responsibility payment”, paid when filing the tax return in 2015.  In general, the payment amount is either a percentage of household income or a flat dollar amount, whichever is greater.

The person will owe 1/12th of the annual payment for each month you (or your dependents) do not have coverage and are not exempt. The annual payment amount for 2014 is the greater of:

  • 1 percent of household income that is above the tax return filing threshold for the filing status, such as Married Filing Jointly or single, or
  • A family’s flat dollar amount, which is $95 per adult and $47.50 per child, limited to a maximum of $285.

The penalty is capped at the cost of the national average premium for the bronze level health plan available through the Marketplace in 2014.

For more than half a century, Tax Facts has been an essential resource designed to meet the real-world tax-guidance needs of professionals in both the insurance and investment industries.

2014_tf_on_individuals_small_businesses-m_1Due to a number of recent changes in the law, taxpayers are currently facing many questions connected to important issues such as healthcare, home office use, capital gains, investments, and whether an individual is considered an employee or a contractor. Financial advisors are continually looking for updated tax information that can help them provide the right answers to the right people at the right time. This brand-new resource provides fast, clear, and authoritative answers to pressing questions, and it does so in the convenient, timesaving, Q&A format for which Tax Facts is famous.

“Our brand-new Tax Facts title is exciting in many ways,” says Rick Kravitz, Vice President & Managing Director of Summit Professional Network’s Professional Publishing Division. “First of all, it fills a huge gap in the resources available to today’s advisors. Small business is a big market, and this book enables advisors to get up-and-running right away, with proven guidance that will help them serve their clients’ needs. Secondly, it addresses the biggest questions facing all taxpayers and provides absolutely reliable answers that help advisors solve today’s biggest problems with confidence.”

tax-facts-online_mediumThe company also points out that the expert authors—Robert Bloink, Esq., LL.M., and William H. Byrnes, Esq., LL.M., CWM®—are delivering real-life guidance based on decades of experience.

The authors’ knowledge and experience in tax law and practice provides the expert guidance for National Underwriter to once again deliver a valuable resource for the financial advising community,” added Kravitz.

Anyone interested can try Tax Facts on Individuals & Small Business, risk-free for 30 days, with a 100% guarantee of complete satisfaction.  For more information, please go to www.nationalunderwriter.com/TaxFactsIndividuals or call 1-800-543-0874.

Posted in Taxation | Tagged: , , , , | Leave a Comment »

The Obama Care “Premium Tax Credit” – 4 days left to take advantage

Posted by William Byrnes on March 27, 2014


On February 25, the IRS released Health Care Tax Tip 2014-03 reminding taxpayers that time is running out – only 4 days left – to enroll for health insurance coverage through the Health Insurance Marketplace.

However, the premium tax credit can help make purchasing health insurance coverage more affordable for people with moderate incomes. To be eligible for the premium tax credit, a tax filer must satisfy three rules:  

1.  Sign up for health insurance coverage through the Health Insurance Marketplace.  The open enrollment period to purchase health insurance coverage for 2014 through the Health Insurance Marketplace ENDS in 4 days on March 31, 2014!

2. Household income between one and four times the federal poverty line.  For a family of four for tax year 2014, that means income from $23,550 to $94,200.

3. Not eligible for other medical coverage, such as Medicare, Medicaid, or sufficiently generous employer-sponsored coverage.

If a  Marketplace determines the taxpayer is likely to qualify for the tax credit at the time of signup on the Health Insurance Marketplace, then the taxpayer has two choices:

1. Choose to have some or all of the estimated credit paid in advance directly to the medical insurance company to lower the pay out-of-pocket for the monthly premiums during 2014, or

2. Wait to receive the premium tax credit when the 2014 tax return is filed in 2015.  Waiting to receive the premium tax credit will either increase the tax refund or lower the balance due to the IRS.

For taxpayers choosing to receive the premium tax credit in advance, changes to income or family size will affect the credit eligible to receive.  If the credit on the 2014 tax return (filed in 2015) does not match the amount received in advance, the taxpayer will have to repay any excess advance payment, or you may get a larger refund if you are entitled to more. It is important to tell your Marketplace about changes in your income or family size as they happen during 2014 because these changes will affect the amount of your credit.

For more than half a century, Tax Facts has been an essential resource designed to meet the real-world tax-guidance needs of professionals in both the insurance and investment industries.

2014_tf_on_individuals_small_businesses-m_1Due to a number of recent changes in the law, taxpayers are currently facing many questions connected to important issues such as healthcare, home office use, capital gains, investments, and whether an individual is considered an employee or a contractor. Financial advisors are continually looking for updated tax information that can help them provide the right answers to the right people at the right time. This brand-new resource provides fast, clear, and authoritative answers to pressing questions, and it does so in the convenient, timesaving, Q&A format for which Tax Facts is famous.

“Our brand-new Tax Facts title is exciting in many ways,” says Rick Kravitz, Vice President & Managing Director of Summit Professional Network’s Professional Publishing Division. “First of all, it fills a huge gap in the resources available to today’s advisors. Small business is a big market, and this book enables advisors to get up-and-running right away, with proven guidance that will help them serve their clients’ needs. Secondly, it addresses the biggest questions facing all taxpayers and provides absolutely reliable answers that help advisors solve today’s biggest problems with confidence.”

tax-facts-online_mediumThe company also points out that the expert authors—Robert Bloink, Esq., LL.M., and William H. Byrnes, Esq., LL.M., CWM®—are delivering real-life guidance based on decades of experience.

The authors’ knowledge and experience in tax law and practice provides the expert guidance for National Underwriter to once again deliver a valuable resource for the financial advising community,” added Kravitz.

Anyone interested can try Tax Facts on Individuals & Small Business, risk-free for 30 days, with a 100% guarantee of complete satisfaction.  For more information, please go to www.nationalunderwriter.com/TaxFactsIndividuals or call 1-800-543-0874.

Posted in Taxation | Tagged: , , , , | 3 Comments »

Four Tax Facts about the Health Care Law for Individuals

Posted by William Byrnes on March 26, 2014


In Health Care Tax Tip 2014-06, the IRS alerted taxpayers to four basic tax tips about the new health care law.  The IRS stated that health insurance choices made now may affect the income tax return filed next year (2015).

1. Most people already have qualified health insurance coverage and will not need to do anything more than maintain qualified coverage throughout 2014.

2. If a taxpayer does not have health insurance through a job or a government plan, the taxpayer may be able to buy it through the Health Insurance Marketplace.  The open enrollment period to purchase health insurance coverage for 2014 through the Health Insurance Marketplace ENDS in 5 days on March 31, 2014!

3. If a taxpayer buy health insurance through the Marketplace, the taxpayer may be eligible for an advance premium tax credit to lower your out-of-pocket monthly premiums. (Tomorrow’s blog article will provide information about this advance premium tax credit.)

4. The 2014 tax return to be filed in 2015 will have a new tax question:  did you have insurance coverage or did you qualify for an exemption?  If not, the taxpayer may owe a shared responsibility payment.

What should you do now?

If a taxpayer or the family does not have health insurance, then talk to the employer about the employer’s health coverage offered, or visit the Marketplace online.

Find out more about the health care law and the Marketplace at www.HealthCare.gov.

Find out more about the premium tax credit and the shared responsibility payment at www.IRS.gov/aca.

For more than half a century, Tax Facts has been an essential resource designed to meet the real-world tax-guidance needs of professionals in both the insurance and investment industries.

tax-facts-online_medium

Due to a number of recent changes in the law, taxpayers are currently facing many questions connected to important issues such as healthcare, home office use, capital gains, investments, and whether an individual is considered an employee or a contractor. Financial advisors are continually looking for updated tax information that can help them provide the right answers to the right people at the right time. This brand-new resource provides fast, clear, and authoritative answers to pressing questions, and it does so in the convenient, timesaving, Q&A format for which Tax Facts is famous.

“Our brand-new Tax Facts title is exciting in many ways,” says Rick Kravitz, Vice President & Managing Director of Summit Professional Network’s Professional Publishing Division. “First of all, it fills a huge gap in the resources available to today’s advisors. Small business is a big market, and this book enables advisors to get up-and-running right away, with proven guidance that will help them serve their clients’ needs. Secondly, it addresses the biggest questions facing all taxpayers and provides absolutely reliable answers that help advisors solve today’s biggest problems with confidence.”

The company also points out that the expert authors—Robert Bloink, Esq., LL.M., and William H. Byrnes, Esq., LL.M., CWM®—are delivering real-life guidance based on decades of experience.

The authors’ knowledge and experience in tax law and practice provides the expert guidance for National Underwriter to once again deliver a valuable resource for the financial advising community,” added Kravitz.

Anyone interested can try Tax Facts on Individuals & Small Business, risk-free for 30 days, with a 100% guarantee of complete satisfaction.  For more information, please go to www.nationalunderwriter.com/TaxFactsIndividuals or call 1-800-543-0874.

Posted in Taxation | Tagged: , , , , | Leave a Comment »

Three Tax Tips about Obama Care

Posted by William Byrnes on March 12, 2014


Here are three tips about how the law may affect you:

The IRS published tax tip HC-TT- 2014-05 alerting taxpayers that Obama Care has provisions that may affect personal income taxes. How Obama Care affects a taxpayer depends on employment status, whether the taxpayer participates in a tax favored health plan, and the taxpayer’s age.

1. Employment Status

  • If a taxpayer is employed then the employer may report the value of the health insurance provided on the W-2 in Box 12 with a Code “DD”.  However, this amount is not taxable.
  • If a taxpayer is self-employed, then the taxpayer may deduct the cost of health insurance premiums, within limits.

2. Tax Favored Health Plans

  • If a taxpayer has a health flexible spending arrangement (FSA) at work, money added to it normally reduces taxable income.
  • If a taxpayer has a health savings account (HSA) at work, money the employer adds to it, within limits, is not taxable.
  • Money added to an HSA usually counts as a deduction.
  • Money used from an HSA for “qualified medical expenses” is not taxable income; however, withdrawals for other purposes are taxable and can even be subject to an additional tax.
  • If a taxpayer has a health reimbursement arrangement (HRA) at work, money received from it is generally not taxable.

3. Age

If a taxpayer is age 65 or older, the threshold for itemized medical deductions remains at 7.5 percent of Adjusted Gross Income (AGI) until 2017; for others the threshold increased to 10 percent of AGI in 2013.  AGI is shown on Form 1040 tax form.

Posted in Taxation | Tagged: , , , , | Leave a Comment »

IRS Offers Obama Care Tax Tips for 2013 and 2014

Posted by William Byrnes on March 11, 2014


The IRS has set up a webpage >Health Care Tax Tips< to help people understand what they need to know for the 2013 federal individual income tax returns they are filing by April 15th, as well as for future tax returns. This includes information on the new Premium Tax Credit and making health care coverage choices.

Because many of the new Obama Care tax rules only went into effect on Jan. 1, 2014, most of these Obama Care changes do not affect the 2013 tax return.

What do I need to know for my 2013 tax return?

Considerations for 2014 tax year?

  • Open Enrollment for the Health Insurance Marketplace: The open enrollment period to purchase health care coverage through the Health Insurance Marketplace for 2014 began Oct. 1, 2013 and runs through March 31, 2014. When you get health insurance through the marketplace, you may be able to get advance payments of the premium tax credit that will immediately help lower your monthly premium. Learn more at HealthCare.gov.
  • Premium Tax Credit: If you get insurance through the Marketplace, you may be eligible to claim the premium tax credit. You can elect to have advance payments of the tax credit sent directly to your insurer during 2014, or wait to claim the credit when you file your tax return in 2015. If you choose to have advance payments sent to your insurer, you will have to reconcile the payments on your 2014 tax return, which will be filed in 2015. If you’re already receiving advance payments of the credit, you need do nothing at this time unless you have a change in circumstance. Learn More.
  • Change in Circumstances: If you’re receiving advance payments of the premium tax credit to help pay for your insurance coverage, you should report life changes, such as income, marital status or family size changes, to your marketplace. Reporting changes will help to make sure you are getting the proper amount of advance payments.
  • Individual Shared Responsibility Payment: Starting January 2014, you and your family must have health care coverage, have an exemption from coverage, or make a payment when you file your 2014 tax return in 2015. Most people already have qualifying health care coverage and will not need to do anything more than maintain that coverage throughout 2014. Learn More.

The Health Care Tax Tips available at >IRS ACA website< include:

  • IRS Reminds Individuals of Health Care Choices for 2014 ─ Find out what you need to know about how health care choices you make for 2014 may affect your taxes.
  • The Health Insurance Marketplace – Learn about Your Health Insurance Coverage Options – Find out about getting health care coverage through the Health Insurance Marketplace.
  • The Premium Tax Credit ─ Learn the basics of the Premium Tax Credit, including who might be eligible and how to get the credit.
  • The Individual Shared Responsibility Payment – An Overview ─ Provides information about types of qualifying coverage, exemptions from having coverage, and making a payment if you do not have qualifying coverage or an exemption.
  • Three Timely Tips about Taxes and the Health Care Law ─  Provides tips that help with filing the 2013 tax return, including information about employment status, tax favored health plans and itemized deductions.
  • Four Tax Facts about the Health Care Law for Individuals ─Offers basic tips to help people determine if the Affordable Care Act affects them and their families, and where to find more information.
  • Changes in Circumstances can Affect your Premium Tax Credit ─ Learn the importance of reporting any changes in circumstances that involve family size or income when advance payments of the Premium Tax Credit are involved.

For more than half a century, Tax Facts has been an essential resource designed to meet the real-world tax-guidance needs of professionals in both the insurance and investment industries.

2014_tf_on_individuals_small_businesses-m_1Due to a number of recent changes in the law, taxpayers are currently facing many questions connected to important issues such as healthcare, home office use, capital gains, investments, and whether an individual is considered an employee or a contractor. Financial advisors are continually looking for updated tax information that can help them provide the right answers to the right people at the right time. This brand-new resource provides fast, clear, and authoritative answers to pressing questions, and it does so in the convenient, timesaving, Q&A format for which Tax Facts is famous.

“Our brand-new Tax Facts title is exciting in many ways,” says Rick Kravitz, Vice President & Managing Director of Summit Professional Network’s Professional Publishing Division. “First of all, it fills a huge gap in the resources available to today’s advisors. Small business is a big market, and this book enables advisors to get up-and-running right away, with proven guidance that will help them serve their clients’ needs. Secondly, it addresses the biggest questions facing all taxpayers and provides absolutely reliable answers that help advisors solve today’s biggest problems with confidence.”

tax-facts-online_mediumThe company also points out that the expert authors—Robert Bloink, Esq., LL.M., and William H. Byrnes, Esq., LL.M., CWM®—are delivering real-life guidance based on decades of experience.

The authors’ knowledge and experience in tax law and practice provides the expert guidance for National Underwriter to once again deliver a valuable resource for the financial advising community,” added Kravitz.

Anyone interested can try Tax Facts on Individuals & Small Business, risk-free for 30 days, with a 100% guarantee of complete satisfaction.  For more information, please go to www.nationalunderwriter.com/TaxFactsIndividuals or call 1-800-543-0874.

Posted in Taxation | Tagged: , , , , | 1 Comment »

Health Insurance Providers Fee (or Tax or Penalty, call it what you will) – IRS guidance issued yesterday…

Posted by William Byrnes on November 27, 2013


and it has finally come to pass time … the new health care penalty, tax, fee – whatever it is, to be calculated for businesses.   Perhaps not the best timing considering the rocky roll out.  On the other hand, better to get the bad news 11 months before the next election, when it can be forgotten by the time mail in ballots are sent out.

Notice 2013-76 provides guidance on the health insurance providers fee related to (1) the time and manner for submitting Form 8963, “Report of Health Insurance Provider Information,” (2) the time and manner for notifying covered entities of their preliminary fee calculation, (3) the time and manner for submitting a corrected Form 8963 for the error correction process, and (4) the time for notifying covered entities of their final fee calculation.

For each fee year, the IRS will make a preliminary fee calculation for each covered entity and will notify each covered entity.  The notification will include (1) the covered entity’s allocated fee; (2) the covered entity’s net premiums written for health insurance of United States health risks; (3) the covered entity’s net premiums written for health insurance of United States health risks taken into account after application of § 57.4(a)(4); (4) the aggregate net premiums written for health insurance of United States health risks taken into
account for all covered entities; and (5) instructions for how to submit a corrected Form 8963 to correct any errors through the error correction process.

The information reported on each Form 8963 will be open for public inspection.  This aspect will be very interesting as various groups pull and then post business’ 8963s.

Posted in Compliance | Tagged: , , , , , , , , , , | 1 Comment »

Overlooked Obamacare Silver Lining: Savings for Small Businesses

Posted by William Byrnes on October 2, 2013


Your small business clients know that the health insurance exchanges set up under the Affordable Care Act (ACA) are coming—and soon—but they may not realize that they create significant benefits for employers in the form of dramatic cost savings above and beyond the current rules governing deductibility of premiums and eligibility for certain tax credits.

Beginning Nov. 1, small business clients will be eligible to sign up online for a specially created Small Business Health Options Program (the SHOP exchange), but clients are unlikely to have realized that the rules of the game have changed with the advent of SHOP.

Read William Byrnes and Robert Bloink’s analysis at Think Advisor

Posted in Compliance, Insurance | Tagged: , , , , , , , | Leave a Comment »

 
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