A year ago, conversations about the new Health Care Bill were all over the airways and the Internet. But it’s been awhile since we’ve heard much. There have been some changes, but largely most of the increases are still in place. How much is the Health Care Bill going to cost you really?
Here’s where we are with some of the most impacting items for small businesses and their owners.
- Requirement for employers to report value of medical insurance on employee’s 2011 Form W-2s.
ACTION: The IRS has delayed this requirement, making it discretionary if the employer wants to comply this year.
- Requirement for businesses to file Form 1099s for corporations and if they purchase goods.
ACTION: Congress removed this requirement. (Thank you Congress!)
- Penalty for individuals who remain uninsured after 2013.
ACTION: This one is still on the books, even though some states have challenged it as unconstitutional. Additionally, the IRS has not figured out how they will be able to determine which individuals owe the penalty tax.
- Excise tax for firms with 50 or more full-time equivalents who have no health plan starting in 2014.
ACTION: This one is still on the books, but it’s made more complicated in that it’s not full-time employees, it is full-time equivalents. So you could theoretically have 100 part-time employees and be required to provide insurance for all of them.
- 3.8% Medicare surtax on passive income for high-income earners starting in 2013.
ACTION: We still need some guidance from the IRS on this one. Unearned includes interest, royalties, dividends, capital gains, annuities and passive rental income. But is K-1 income from an S Corporation subject to it? The rules exclude business income, but K-1 income is not earned income. High income means over $250,000 for married filing jointly, $200,000 for single.
It’s unlikely that we’ll see much change before these are enacted. If there is a change, it’ll have to come from the US Supreme Court.