Tag: "tax"

Twofer: Ryan’s Medicare Plan Saves Taxpayers $20 Billion and Reduces Seniors’ Premiums

Paul Ryan keeps making his Medicare reform proposal more politically palatable, while still saving money all around:

08Ryan’s plan has gone through several versions, but all of them have been based on the old bipartisan idea of “premium support.” The idea was that instead of paying for senior citizens’ medical services directly, the federal government would help them purchase private coverage plans.

The CBO still projects savings for the federal government — $15 billion — but it shows that beneficiaries will pay less, too.

(Ramesh Ponnuru, Bloomberg View)

Did You Fill Out Your Tax Return Correctly?

Toy Businessman on a Pile of MoneyThe results for the EITC are not pretty. The Internal Revenue Services estimates that 21 to 25 percent of EITC payments were issued incorrectly during the fiscal year 2012, totaling from $11.6 to $13.6 billion in too much money being paid out to taxpayers. As a result, the Office of Management and Budget has labeled the EITC a “high-error” government program. Projections by the government show that the rate of error is expected to remain stubbornly high.

…[T]he IRS estimates that 21 percent of those who are eligible do not claim the credit at all. And so the EITC cuts both ways: both too much being handed out to taxpayers and too little.

Jia Lynn Yang.

Headlines I Wish I Hadn’t Seen

Food Stamp recipients outnumber women who work full-time

Obama has proposed 442 tax hikes since taking office

Which chain do you think is more heavily celebrated on the website of the American Cancer Society? CVS, which will stop sales of all tobacco products, or Walgreens, which won’t?

Headlines I Wish I Hadn’t Seen

money-rollsThe CBO estimates that 6 million people will pay a total of $8 billion in (ObamaCare) fines in 2016.

Vacation in China: We paid for this?

Drudge pays ObamaCare penalty tax and so will other self-employed individuals who have to pay their taxes quarterly.

Before ObamaCare, a 27-year-old man in Dallas could have purchased catastrophic coverage for $69 per month; now, the cheapest plan available on the federal exchange is $173 per month

90% of papers that have been published in academic journals are never cited and as many as 50% of papers are never read by anyone other than their authors, referees and journal editors.

Work Over-Time or Get a Bonus and You Could Owe the IRS $10,000

…[I]ndividuals who enroll in the ObamaCare exchange will run the risk of having to pay back a significant portion of the tax credit if their life circumstances change…

The result will be surprise bills from the IRS in the mail come tax time 2015, in the order of a couple hundred dollars all the way up to full value of any subsidy received if a family crosses the 400% FPL threshold. (This could be $10,000-$12,000 for a family of four, as an example.) Just a few dollars of extra income could result in thousands of back taxes to be paid.

Josh Archambault.

Goodman’s Law: If You Tax Something You Will Get Less of It

From 2001 to 2011, the number of nonprofits in the United States grew 25 percent while the number of for-profit businesses rose by half of 1 percent, according to the most recent figures compiled by the Urban Institute.

There are still considerably more businesses than nonprofits, of course, about four times as many. But over that period, nonprofits also outpaced businesses in their percentage growth in hiring, wages and contribution to the gross domestic product, according to the Urban Institute. (NYT)

Almost Anyone Can Claim ObamaCare Tax Credits

What to make of the Center for Medicare & Medicaid Services’ notice that it will pay out retroactive ObamaCare premium tax credits and cost-reducing subsidies to people who have not yet signed up for ObamaCare?

The media have reported that these payments will be dished out to people who bought qualifying health insurance outside an ObamaCare exchange because the exchanges have not been working. According to the New York Times, the new policy is a result of the heroic lobbying of Oregon Governor John Kitzhaber, whose exchange has failed to enroll almost anybody. According to Professor Sara Rosenbaum of George Washington University Law School: “People could have gone to court to obtain benefits denied without due process of law, because of a breakdown in government eligibility systems, and a judge would probably have ordered retroactive relief. The federal government is voluntarily providing equitable relief that a court would have given.”

ObamaCare Health Insurance Fee Will Increase Family Premium $240 in 2014

Robert Book of the American Action Forum has a new analysis of ObamaCare’s annual fee on health insurance:

  • The amount of the “annual fee” tax on health insurers is $8 billion for 2014, $11.3 billion in 2015 and 2016, $13.9 billion in 2017, and $14.3 billion in 2018. Amounts for years after 2018 are set by a statutory formula.
  • The tax will result in a premium increase of $60 to $160 per person in 2014, rising to $100-$300 by 2018, for the average insured individual — and over $260 per family in 2014, rising to over $450 in 2018, for families with employer-sponsored, fully-insured coverage.
  • The tax applies to individually purchased insurance (through exchanges or otherwise), fully insured employer-sponsored plans, Medicare Advantage, and Medicaid managed care.

Hits and Misses

pillsIs the surge in ADHD drugs the result of pressure to increase student test scores?

Should the sale of a woman’s unfertilized egg be taxed as ordinary income, or as a capital gain? HT: Tyler Cowen.

In contrast to health care.gov, business on a private exchange is booming.

In the exchange: only 19 percent of enrollees are choosing the cheapest (bronze) plans, while 7 percent are picking the most expensive.

Are Democratic candidates running away from ObamaCare?

ObamaCare Taxes Will Sock It to Low-Income Families

President Obama’s campaign promise:

I can make a firm pledge under my plan, no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes.

Chris Conover comments:

There’s 21 different taxes stuffed into ObamaCare designed to raise more than $1 trillion in taxes over the next decade. Last October I showed that only 30% of these taxes would actually be borne exclusively by “rich” households ($200,000+ for singles/$250,000+ for couples)…

Even the lowest income families (earning less than about $19,000 in 2012) will be on the hook for nearly $7,000 in ObamaCare taxes over the decade that started last year. [See the graph.]


Let’s be clear. ObamaCare also absolutely and positively is socking it to the “rich” (approximately the top 2%). I calculate that families in that income range will end up paying $177,000 over the same decade. But the much more surprising figure is that such families will end up bearing only 34% of the ObamaCare tax burden. It’s true that the top 20% of families will bear about 56% of the overall burden, but such families also account for 50% of after-tax income (at least according to the Consumer Expenditure Survey data I used to make my calculations).