By Robert Wood
As President Trump and a Republican Congress tiptoe into the minefield that is the Affordable Care Act, it is worth remembering that the law is arguably more a tax law than a health care law. It was, after all, upheld by the Supreme Court as a tax law. And it is full of taxes. Perhaps the signature tax of Obamacare is the Cadillac tax. Long before Donald Trump took an unexpected path to victory, the Cadillac tax seemed doomed. The Republicans have been saying it for years, and eventually, even Secretary Clinton agreed. Curiously, a single sentence on page 35 of the 2016 Democratic Party Platform says:
"We will repeal the excise tax on high-cost health insurance and find revenue to offset it because we need to contain the long-term growth of health care costs, but should not risk passing on too much of the burden to workers.”
Viewed from 2010, the Cadillac tax was supposed to rake in huge dollars to help pay for Obamacare. The Cadillac tax is a 40% tax on the cost of employer-sponsored health coverage exceeding certain thresholds: $10,800 for self-only coverage, and $29,100 for family coverage. The cost of wellness programs, on-site clinics and other plan features meant to reduce expenses are also included. Vast number of participants in numerous employer-sponsored plans will be affected. There have been multiple bills to repeal it. But now that there is a Republican Senate, House and President, its fate seems sealed.
The larger question is about Obamacare in general, and its plethora of taxes. For that 'how many taxes' question, it depends how you count and what you regard as a tax. There are also many other Obamacare taxes, including these:
This article originally appeared at Forbes.com.
The information provided in this article is for general information purposes only. The information is not intended to be comprehensive or to include advice on which you may rely. You should always consult a suitably qualified professional on any specific matter.
I’m a tax lawyer based in San Francisco (www.WoodLLP.com), but I handle tax matters everywhere. I enjoy untangling a tax mess from the past, disputing taxes with the government or planning taxes for the future. One of my specialties is advising about lawsuit payments. Whether you’re receiving or paying a legal settlement, you can probably improve your tax position. I write frequently about taxes, from expatriation to sales tax, from selling your company to restitution. I’ve written over 30 tax books, but my best seller is still Taxation of Damage Awards and Settlement Payments. Contact me at wood@WoodLLP.com.
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