the new Obama tax

[happythoughts 0]

Health care benefits have been historically immune
to taxes since roughly the 1940s. The exemption has
never been tinkered with.

new health benefits tax

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Published: March 14, 2009
WASHINGTON — The Obama administration is signaling to Congress that the president could support taxing some employee health benefits, as several influential lawmakers and many economists favor, to help pay for overhauling the health care system.

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The proposal is politically problematic for President Obama, however, since it is similar to one he denounced in the presidential campaign as “the largest middle-class tax increase in history.” Most Americans with insurance get it from their employers, and taxing workers for the benefit is opposed by union leaders and some businesses.

An entirely new tax on working middle-class Americans.

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In television advertisements last fall, Mr. Obama criticized his Republican rival for the presidency, Senator John McCain of Arizona, for proposing to tax all employer-provided health benefits. The benefits have long been tax-free, regardless of how generous they are or how much an employee earns. The advertisements did not point out that Mr. McCain, in exchange, wanted to give all families a tax credit to subsidize the purchase of coverage.

So...the McCain version included a tax credit.
Not so, the Obama plan. The O plan is a tax.

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Now that Mr. Obama has begun the health debate, several advisers say that while he will not propose changing the tax-free status of employee health benefits, neither will he oppose it if Congress does so.

Sweet! He won't propose it, but he won't stop it.
Who will be the Sacrificial Lamb?
Who will fall on the party sword?

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At a recent Congressional hearing, Senator Ron Wyden, an Oregon Democrat whose own health plan would make benefits taxable, asked Peter R. Orszag, the president’s budget director, about the issue. Mr. Orszag replied that it “most firmly should remain on the table.”

Hmm... Mr W... step forward and pick a Special Pork
prize from the second shelf of the Obama "Stimulus Barrel".

Where are the estimates of the amount of the
tax hike? We could use the Obama campaign
estimates...

Quote

In the campaign, Mr. McCain estimated that taxing all health benefits would raise $3.6 trillion over a decade — “a multitrillion-dollar tax hike,” one Obama advertisement said.

True?
FactCheck

Quote

Obama: I’m Barack Obama and I approve this message.

Announcer: On health care, John McCain promises a tax credit. But here’s what he won’t tell you: McCain would impose a new tax on health benefits, taxing your health care for the first time ever.

It’s a multi-trillion dollar tax hike. The largest middle-class tax increase in history. You won’t find one word about it on his Web site. But the McCain tax could cost your family thousands. Can you afford it?

The McCain plan included a tax credit, so this estimate
is known to be not actually accurate at all... unless you remove
the tax credit - then you get the Obama plan.

$3.6 Trillion in new taxes? Oh my.

[happythoughts 0]

NPR (part of the right-wing conspiracy) February 26, 2009

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Obama Plan Would Boost Taxes On Wealthy
by The Associated Press

Inside Obama's First Budget: A Breakdown Of The Spending Plan

NPR.org, February 26, 2009 · President Barack Obama unveiled a multitrillion-dollar spending plan Thursday that would boost taxes on the wealthy...

...as of 3 weeks ago.

Quote

Obama's budget proposal would effectively raise income taxes and curb tax deductions on couples making more than $250,000 a year, beginning in 2011. By not extending former President George W. Bush's tax cuts for such wealthier filers, Obama would allow the marginal rate on household incomes above $250,000 to rise from 35 percent to 39.6 percent.

Any money bet on whether the tax cuts for the
wealthy will get extended ?

Quote

The plan balances efforts to fulfill Obama's campaign pledges to deliver tax cuts to the middle class

blam... blam blam...
"I'm going to reload now. Please remain still or some
rounds may miss your back."

[Unstable 9]

Ya know, I seem to remember something that happened in 1929. You know, the economy was on rough rocks, and then Mr. President Decided to stabilize it by raising taxes. I'm sorry, I'm not that great at history, but did it work then? I can't remember....Anyone want to remind me what the 1930's were like?

=========Shaun ==========

[Misternatural 0]

>>Anyone want to remind me what the 1930's were like?


Yes-
For that we have to read the ancient texts.

Beware of the collateralizing and monetization of your desires.
D S #3.1415

[wmw999 2,589]

Couple of things:
Reagan thought about it
Clinton might have thought about it (look down low at a Chicago Sun Times reference)
Bush II thought about it it
And of course after the last election we all know that McCain thought about it (but he would have also provided a tax credit to offset the change for many).

Also, one of the primary sets of people with disproportionately good benefits are union members. Doesn't everyone want to take any opportunity possible to shiv them?

Personally, it'd hit me for sure. But we'll see what happens. Lots of trial balloons are being floated -- the fact that they're thinking of possibly off-limits things and asking about them is not bad. That's what "thinking outside the box" consists of. and thinking outside the box is often how one solves problems.

Because continuing to do the same thing, and expecting a different result, is probably not the best approach. I believe that's a synonym for insanity

Wendy W.

There is nothing more dangerous than breaking a basic safety rule and getting away with it. It removes fear of the consequences and builds false confidence. (tbrown)

[Misternatural 0]

To use the 30's as an example of what happens when certain political economic policies are applied relating to current economic events you may as well be reading the scrolls of Leviticus to construct the space shuttle.

The only fundamental economic principal that still applies today is that of supply and demand.

As I keep saying, the current global economy is of such scale and complexity that only a supercomputer can properly predict or manipulate it...and I hope the government is using some of this vast technology to do so because what I see each administration doing so far is akin to spilling goat guts down the Federal Reserve building steps and reading their shape as it relates to the alignment of the planets a la Ronald Reagan.

We will just have to see how this plan plays out before applying any depression era predictions about it.

Beware of the collateralizing and monetization of your desires.
D S #3.1415

[dreamdancer 0]

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The only fundamental economic principal that still applies today is that of supply and demand.

and human greed?

stay away from moving propellers - they bite
blue skies from thai sky adventures
good solid response-provoking keyboarding

[Misternatural 0]

>and human greed?

absolutely, but greed is just another form of love, or is it the other way around?

And I made some money on the stock market today a result of it-
which seems to be climbing lately for some reason...let us consult the astrological charts as to why.

Beware of the collateralizing and monetization of your desires.
D S #3.1415

[happythoughts 0]

Quote

And of course after the last election we all know that McCain thought about it (but he would have also provided a tax credit to offset the change for many).

Yes, McCain DID clearly state his position.
People of both parties have discussed it for years.
McCain wanted to get rid of the exemption and provide
a tax credit to offset it. He stated his plan.

I mentioned all that in the first post of the thread.

(Since taxes never go down, I believe that the credit
would gradually fade away.)

The interesting parts are:
- Obama misrepresented McCains figures by calculating
the impact without the tax credit (as mentioned
by FactCheck.org).
"Intentional misrepresentation" - worth repeating.
He did this for political mileage.

- Then, he was very opinionated about how big a tax
increase that this would be for Every American, not just
the Rich Americans like under Obamas tax proposal.
He was very adamant about this.

So, he seemed pretty upset about the Big Tax Increase
under the McCain proposal (and it wasn't).

And here we are...

- He adopts McCains proposal that he attacked.
- He worsens it by stripping it of its protective legislation.
- He applies a huge tax to the Average American after claiming to never do that.
- He won't promote it, but will support it.

Nice list.
From November to now.
- Campaign lies.
- Flip-flopping.
- Reversing campaign promises.
- Increasing taxes to the average American.

If he just used McCain's plan, we'd be better off.

[wmw999 2,589]

Well, you were railing pretty thoroughly on this being new territory; with the number of presidents who have considered it, it's not quite so new.

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He did this for political mileage

A politician, running in a campaign, did something for political mileage? I agree, it sucks. The whole issue and the way it was handled.

I'm still waiting to see what actually happens. If McCain had been elected, he would have been handed a shit sandwich, too. And there would be some appalling discussions too.

A lot of people smarter and more knowledgeable than me say that just letting those banks fail would have been far more devastating. The pissed-off in me wants to see it demonstrated. But the neighbor's-house-is-burning analogy is not a bad one. Even if he started the fire by smoking, and made it worse by building his house out of straw. His house can still fuck up the whole city. Even if my house is built of stone, the store where I buy my food, and the business where I work, probably aren't.

Wendy W.

There is nothing more dangerous than breaking a basic safety rule and getting away with it. It removes fear of the consequences and builds false confidence. (tbrown)

[happythoughts 0]

Quote

Well, you were railing pretty thoroughly on this being new territory; with the number of presidents who have considered it, it's not quite so new.

Nope, I was railing on Dem party BAU.

During the campaign, he lied about what McCain said.

If he wanted to get honestly elected, then he should
have told the truth about McCain's plan.
He should have told the truth about his actual plans.

Then, the voters could honestly evaluate and choose.

his words

"I'm asking you to believe..." - BO

[Misternatural 0]

>If he just used McCain's plan, we'd be better off.

How the hell can you make that determination? you do understand the scale of economic complexity we are talking about? it' involves things like the Butterfly Effect, Entropy, and fractal geometry. What these politicians are doing is no better that reading tea leaves and goat guts by comparison- and most people in America are eating it up like it is gospel- It is merely an effective way to sell party politics.

For example-not that this has anything to do with taxes but Bernanke practically steps out of the Fed building wearing robes and "hints" at what the Fed is going to do to manage inflation. This is like some high priest running an economy with a reading of the Mayan calendar to a crowd of devoted believers.

Beware of the collateralizing and monetization of your desires.
D S #3.1415

[kelpdiver 2]

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(Since taxes never go down, I believe that the credit
would gradually fade away.)

uh, taxes go down all the time. Income tax brackets, capital gains tax rates, dividend tax rates. These go up and down over time.

[kelpdiver 2]

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If he wanted to get honestly elected, then he should
have told the truth about McCain's plan.
He should have told the truth about his actual plans.

ROTFLMAO.

was this a serious statement, or just sour grapes from a loser? Should he have voted for McCain too, just to be super fair?

Shall we recount the honesty of the election of the past 40 some presidents?

Personally, I think McCain was right to try to divorce health care from employment. A big reason we're stuck with this increasingly bad mess is because of this marriage. It's ridiculous that my health premiums paid via work are taxfree, but if I lose/change my job and am paying COBRA, it's not. (ignoring the temporary benefit now where the feds pay 65%)

But this sort of change was not going to be popular had he won and started the legislation, any more than it will be if the Democrats actually try to implement it. It's way early to be whining this much about it.

If it comes in, there will be a credit, and like the child credits, it will often be raised in the future. Why on earth could you believe the Democrats would not, given that this is a tax benefit/hike that most directly affects their voters, far more than it affects the GOP faithful.

[happythoughts 0]

Quote

Quote

If he wanted to get honestly elected, then he should
have told the truth about McCain's plan.
He should have told the truth about his actual plans.

ROTFLMAO.

was this a serious statement, or just sour grapes from a loser? Should he have voted for McCain too, just to be super fair?

Shall we recount the honesty of the election of the past 40 some presidents?

Serious? As serious as a heart attack.

That is the f-in basis of the whole democratic system.
For your review, candidates state a platform of policies and
the voters choose based on their statements.
That is how it works.

Of course, in discussions of character, there seems to be a
dismissal of the topic with the tactic of a 6-yo,
"...but Mom... everyone is doing it."

McCain didn't. He stated his program.

Let politicians take personal responsibility for their statements
and their actions, regardless of their party.

One politician at a time. If someone wants to discuss another politicians actions, then they can start a thread about it.
Until then, comparisons are only valuable as a tactic to
confuse and avoid actual discussion. A forum is for discussion.

[Misternatural 0]

>That is the f-in basis of the whole democratic system.
For your review, candidates state a platform of policies and
the voters choose based on their statements.
That is how it works.

I get what you are saying....and it has been like this for centuries, The ancient leaders followed the same format time and time again:
"Your lives will be better because through me and my crew I have a special positive influence over the forces that control your lives.

This is what I have been saying in my circuitous cryptic way;Todays politician is no different than the Pharaohs who stood on a stone perch and proclaimed that through them the harvest will be good for the next 10 sun cycles because they have special communication with the Sun, the Moon, birds,and the fucking fish of the sea.

When in actuality the people have just as much influence over their own fate.

American politicians over the decades package and sell their tax policy to the same effect. and they have successfully convinced voters as such.

Taxes do affect people in some way but they don't necessarily control or direct the whole economy, much as some would lead you to believe, because of its complexity.

Beware of the collateralizing and monetization of your desires.
D S #3.1415

[kelpdiver 2]

Quote

Of course, in discussions of character, there seems to be a
dismissal of the topic with the tactic of a 6-yo,
"...but Mom... everyone is doing it."

McCain didn't. He stated his program.

Ah, so Happy (but naive) Thoughts it is. McCain's NO BS talk was completely full of it, and was no more noble than any other candidate.

[georgerussia 0]

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It's ridiculous that my health premiums paid via work are taxfree, but if I lose/change my job and am paying COBRA, it's not. (ignoring the temporary benefit now where the feds pay 65%)

AFAIK if you're on 1099, you could deduct your health insurance payments. Since COBRA payments are insurance payments, in theory are deductible when you change or lose the job (not in all cases, and not for everyone though, there are a few rules here). If you have HSA, paying for your health insurance from it is eligible expense.

Quote

But this sort of change was not going to be popular had he won and started the legislation, any more than it will be if the Democrats actually try to implement it. It's way early to be whining this much about it.

If it's implemented, I guess the insurance premiums for everyone will go up. The reason is simple: at this moment "rich" people usually get the best (and most expensive) insurance from their employer, since a) it's tax-free and b) employer covers part of it, so their personal costs are pretty low (around $300/month for family with no deductible and small copay). If those benefits become taxed, people will reconsider their choice, and are more likely to choose a cheaper plan. As a result, the total amount of collected insurance premium will drop, and the company will have to increase premium to cover the cost.

I would also like to point out that this change will mostly affect middle class and low end of "Obama-rich" people. It's possible to get already a very good insurance for $1500/mo which seems to be top of the line, and is still affordable for someone making 250K a year, and someone making 1M a year is likely to have the same insurance (therefore effect on them will be lower), and those making more might not have health insurance at all as they could just pay cash (therefore it will not affect them at all).

* Don't pray for me if you wanna help - just send me a check. *

[kelpdiver 2]

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AFAIK if you're on 1099, you could deduct your health insurance payments. Since COBRA payments are insurance payments, in theory are deductible when you change or lose the job

This is correct, but it only helps if you lose your job and get a 1099 job. In all my years of contracting, I was 1099 for a very limited portion...too many companies fear the reclassification lawsuits like the ones MS had.

Since W2 employees on a group plan, and 1099 workers in general both enjoy tax deduction status, it seems simple enough that any health insurance premiums should be that way. It's not like I had to offer any proof when I did make the 1099 deduction - it was just a dollar figure on one line.

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If it's implemented, I guess the insurance premiums for everyone will go up.

I would also like to point out that this change will mostly affect middle class and low end of "Obama-rich" people.

I agree, which is why I doubt it would be completed. It's like Social Security - we know the status quo is untenable, but no one is going to be the one to touch it in the attempt to get it to a new destination. Too many losers in the process that will vote in the next election.

[georgerussia 0]

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This is correct, but it only helps if you lose your job and get a 1099 job. In all my years of contracting, I was 1099 for a very limited portion...too many companies fear the reclassification lawsuits like the ones MS had.

So far all years I worked in U.S. I had both W-2 and 1099 income :)
If you do not have anything which could be classified as 1099 income, you might still deduct it using HSA.

* Don't pray for me if you wanna help - just send me a check. *

[kelpdiver 2]

Quote

Quote

This is correct, but it only helps if you lose your job and get a 1099 job. In all my years of contracting, I was 1099 for a very limited portion...too many companies fear the reclassification lawsuits like the ones MS had.

So far all years I worked in U.S. I had both W-2 and 1099 income :)
If you do not have anything which could be classified as 1099 income, you might still deduct it using HSA.

As I read it, you can deduct the health insurance for the months you had 1099 work, rather than for the entire year.

The HSA approach has a lot of restrictions - would not be applicable to a COBRA based plan you have from a prior employer.