Obamacare contains over 20 new or higher taxes. Some will first go into effect on January 1, 2011, the rest will phase in by 2014.
The Special Needs Kids Tax. This provision of Obamacare imposes a cap on FSAs which are flexible spending accounts used by the taxpayer to contribute before tax dollars that can be used for out-of-pocket health care expenses. Currently there is no federal government cap on these accounts. Obamacare imposes a $2500 cap. Under Obamacare you will not be able to contribute more than $2500 to an FSA, no matter what your health care needs are.
One of the problems with this provision? There are thousands of families with special needs children and many of them use FSAs to pay for special needs education, which can easily exceed $10,000 per year.
Under the pre-Obamacare rules families could use FSA dollars to fund the special needs education of their children. Under Obamacare FSA dollars cannot be used to pay for this type of special needs education, NONE OF IT. This will have a huge tax impact on families who have special needs children.
The Medicine Cabinet Tax. Obamacare, oh, how great it will be for us, so Obama promised. But look closely at this provision. You will no longer be able to use a Health Savings Account (HSA), a flexible spending account (FSA) or health reimbursement (HRA) pre-tax dollars to purchase non-prescription over-the-counter medication, even medications that your doctor says you must take due to a chronic condition that can be treated with over-the-counter drugs. This provision will force your doctor to write a prescription for something you could get at the counter. Anybody think a "prescription" for an "over-the-counter" drug is going to save money?
The HSA (Health Savings Account) Withdrawal Tax Hike. Currently you can withdraw funds from your HSA for non-medical reasons and pay a 10% penalty. That's the same penalty you pay if you withdraw funds early from an IRA. But under Obamacare the HSA non-medical withdrawal penalty goes to 20%.
These examples are only a few of the over 20 new taxes coming our way under Obamacare.
What was that he said repeatedly during the campaign? Under $250,000 in income your taxes will not change? There will be no new taxes for the middle income taxpayer? Did he really say those things? You Bet!
But I contend these new Obamacare taxes will hit the middle income taxpayer harder than any other group, in spite of what King Obama proclaimed.
AND THERE IS MORE, SO MUCH MORE COMING AT US IN JANUARY.
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