from a professional investors' BBS ...
(snip)"Should you want to verify this, go to , 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. "(snip)
The obvious take-away is that, beginning on January 1st, this one paragraph change in IRS tax law will immediately reclassify the 'equivalent cash value' of employer provided health insurance coverage to be additional taxable 'ordinary income' for every worker instead of a 'free' employee benefit. This in turn will mean that a club customer currently earning say $ 50,000 per year in salary plus $15,000 in 'free' employer health insurance ... and paying perhaps 10% of that amount or $ 5,000 per year in federal income tax on that $50,000 income ... will face a huge change.
While that club customer's $50,000 salary won't change, from a legal standpoint this new law is equivalent to the employer increasing the club customer's salary to $65,000 and then subtracting the $15,000 employer's cost of health insurance coverage for that employee and his family. This however will translate into the employee having to pay federal income taxes based on the new $65,000 amount ... amounting to perhaps $7,250 instead of $5,000 due to the progressive income tax rates applying a 15% tax rate to the additional $15,000 in health insurance benefit cost 'income' ( assuming that the club customer is married ).
Even though this will probably be called a National Health Care related 'rule change' instead of a 'tax increase', the fact remains that the club customer will wind up having to pay $2,250 additional dollars in federal income taxes on the SAME salary ... which in turn means that the club customer will have $2,250 a year less money available to spend on non-essential items such as lap dances !
I would also point out that, based on whatever actions do or do not take place between now and the end of the year in regard to expiring GWB tax cuts, for many single club customers the additional taxes resulting from the above 'rule change' could be involve a much higher percentage ( i.e. 28% if the GWB tax cuts are allowed to totally expire ). Thus in the same $50,000 a year salary scenario, and perhaps $10,000 worth of 'equivalent cash value' of employer provided health care benefits, that single club customer will have $2,800 a year less money available to spend on non-essential items such as lap dances !
For anyone that is interested, this and other tax changes are detailed at the Kiplinger's link referred to by the author - see
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