As the House tries to strip funding from Obama's sweeping health-care reform, we wanted to show you how the law is not just about health care - it's one of the largest tax hikes ever.
Continue Reading Below
Nearly two dozen taxes are included, and that will surely hit your pocket. Plus it is another way for President Obama to get at the wealthy - many of the taxes in this law are geared towards those making over that dreaded $250 thousand mark.
For example, in two years the Medicare payroll tax will be expanded to include investment income. According to The New York Times, this tax will be nearly 4% of this income including capital gains, dividends, interest and royalties.
That's Draconian! So if you need to sell a big investment, do it soon.
Obamacare also brings major changes to your pre-tax health accounts, such as HSAs or FSAs. Starting last month, the $5 billion medicine cabinet tax went into effect. This means Americans can't use these accounts for over-the-counter meds.
If you wanted to withdraw from your HSA, there is now a 20% tax - much higher than the normal 10%.
Continue Reading Below
In 2014, a $2,500 limit for your flexible spending accounts kicks in. Plus, starting in 2013, if you normally deduct medical expenses on your taxes - the threshold is going up from 7.5% of your income to 10%.
This directly hurts families with critically ill members and of course, the elderly.
The biggest taxes - thankfully don't go into effect until 2014, but when they do they will be painful. They're a result of the individual and employer mandates. If an employer with at least 50 workers does not provide health coverage, they must pay $2,000 tax for each employee. And if they make the employees wait, there's an additional $400 tax per employee.
Individually if you refuse to buy coverage, you get your own excise tax. In 2014, that would be 1% of your income and it goes to 2.5% you still don't have coverage by 2016. This is the part of the law states are challenging in court.
Those are the big changes, but there are other smaller taxes and fees still to come. Medical device manufacturers are getting a more than 2% tax in 2013. Also in 2014, health care companies will start getting charged an annual fee in proportion to their market share—some up to $8 billion— and guess who'll pay for that?
Us the consumers, through premium increases.
If you're looking to get a little color, I'm talking to the Snookis of the world out there, a 10% tax for tanning salons went into effect last summer.
This law has always been out of control, we need to throw it out and start over on a law that would actually reform our health care system without taxing us all to death.