Dirk McLargeHuge wrote:True, but if this plan passes, your employer's coverage, and the supplemental coverage you enjoy now will be considered income, and taxed appropriately. Congratulations on the raise!
It was pretty clear in last night's speech there is the intention to now consider all health insurance premuims paid as taxable income to the individual. This does not apply to only the top 5% of wage earners, but anyone with health insurance will be now be paying additonal taxes. Look at your paystub to see how much your employer is paying for health insurance (if at all) and add to that whatever you are personally having deducted from your check at this time tax free to pay for health insurance (additional coverage for yourself, spouse, kids, etc.). That total will be added to your other income at the end of the year and it will be taxable. Even though the National Health Care "public option" is currently not scheduled to start until 2013, I would expect these new taxes to start immediately. Obama was very clear last that you are currently receiving a federal subsidy at this time if you have health insurance and that must stop.
It currently is a tax-free benefit if either you or your employer pay for health insurance. The idea behind this is to encourage employers and individuals to have health insurance. Previously if you and/or your employer pay into to a health insurance plan at this time you are helping with the nation's health care safety net and that should be rewarded by not taxing that expense. Reminds me of when they started making it possible to tax Social Security distributions as regular income many years ago. Is your ability to write off your mortgage interest next?
