[cfgeeks] Save the clocktower!

[Karen Hill]

Thanks Aaron.  So I guess it's basically like what I thought.  It's more smoke-screen than real answers, because the majority of people that are uninsured in this country are uninsured because they can't afford the premiums to begin with.  Being able to pay it up front just to get "reimbursed" on their taxes isn't an answer.  If you only make $1,500 a month (net), you won't be able to spend $600 of that on insurance even if you will receive it back at the end of the year.  This may help middle-class me, but not the people that truly need it...*sigh*  In the payroll industry the people we see going without health insurance are those in service industry jobs more than any other.  In Florida we thrive on service industry jobs...so that affects a lot of people just in our state alone.

$6.15/hour * 160 = $984/month
$6.67/hour * 160 = $1,067.20/month
$10/hour * 160 = $1,600/month

How do people live, much less buy health insurance?

----- Original Message ----
From: Aaron Morrison <ae4ko at amsat.org>
To: Central Florida Geeks <cfgeeks at mail.cfgeeks.org>
Sent: Monday, February 5, 2007 3:58:49 PM
Subject: Re: [cfgeeks] Save the clocktower!


I haven't followed the thread completely, so I may be off base a bit,  
but...

As far as I understand things, the deduction is _up to_ $15,000.  So  
if I purchase a plan that has $1,000/month premium, then I could  
deduct only $12,000.  As for realizing the deduction, it would  
probably show up as a new line item on an itemized 1040 deduction  
schedule (much like the mortgage interest and medical cost deductions  
are done now.)  And since it is a deduction, it will reduce your  
taxable income.  So if you would have normally been taxed at the 15%  
tax bracket, the $12,000 deduction would save you (12,000*0.15)  
$1,800 in taxes (or $2,250 if taking the full $15,000 deduction --  
potentially).

Basically it makes the money you spend on health insurance tax-free  
(up to $15K); well that's the idea anyway.

As for employer/employee supplied, it depends on who pays for the  
premium.  If the employer pays the premium, then that is a benefit  
(indirect income) to you that is not currently taxed (more precisely,  
it's not being reported as income on your W-2) and as such you  
probably would not be able to claim a deduction.  On the other hand,  
if you pay the premiums (employee-supplied), then you are using after  
tax money to pay that, and therefore you would be able to claim a  
deduction on those premiums.

Again, that's how I understand things at the moment; mostly based on  
how things currently work.  This stuff is not law, so things might  
change a lot.  And whether this will fix the issues or not, I can't  
say.  I know it's essentially an attempt at creating universal health  
care using free-market forces (which I think is a good thing).  The  
question is, is this particular proposal the answer?  That, I don't  
know.

Clear as mud?

--am



On 05 Feb 2007, at 15:35, Karen Hill wrote:

> Maybe I just don't understand how it works... so how does a family  
> get a "$15,000 tax deduction" for purchasing health coverage? How  
> do they realize that tax deduction??
>
> And do they mean "Employer-supplied" versus "employee-supplied" or  
> is that basically, the same thing?
>
>
>
> ----- Original Message ----
> From: syberghost <syberghost at gmail.com>
> To: Central Florida Geeks <cfgeeks at mail.cfgeeks.org>
> Sent: Monday, February 5, 2007 3:32:14 PM
> Subject: Re: [cfgeeks] Save the clocktower!
>
> On 2/5/07, Karen Hill <karendhill at yahoo.com> wrote:
> >
> > The president's budget also includes an initiative to expand  
> health care
> > coverage to the uninsured through a complex proposal that would  
> give every
> > family a $15,000 tax deduction for purchasing health coverage but  
> would make
> > current employee-supplied health coverage taxable for certain  
> taxpayers.
> >
> > --What????
>
> Taxing the haves to provide health care to the have-nots.  I know why
> I object to it, but I'm surprised to see you objecting.  :)
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