IRS: Employers Face $36,500 Per Worker Tax for ‘Obamacare Dumping’

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Breitbart:

The Internal Revenue Service ruled it will impose a tax penalty on employers of up to $36,500 per worker for dumping employees into the Obamacare exchanges.

The New York Times, which broke the story, reports:

When employers provide coverage, their contributions, averaging more than $5,000 a year per employee, are not counted as taxable income to workers. But the Internal Revenue Service said employers could not meet their obligations under the health care law by simply reimbursing employees for some or all of their premium costs.

The IRS ruling is an effort by the Obama administration to stop employers with 50 or more workers from doing what critics of the health law said they would do: pay a penalty for not providing insurance and dump workers into the unpopular Obamacare program.

With the Nov. 4 midterm elections looming, the Obama administration could not allow massive waves of employer cancellations before Democrats face an already angry electorate.

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This is big news and a major change in ObamaCare.

Employers had voluntarily been doing a service for workers before O’Care by offering group coverage for them.

Now, the IRS is making it mandatory they keep doing it, even if it means huge increases in continuing to cover workers since O’Care requires so much more coverage….
like gynocological care for MEN and birth control pills for MEN and abortifactants for MEN as well as prostate exams for WOMEN.

There are work-arounds already being discussed…..
Businesses can go under for part of a year, re-emerge with a ”new” workforce of people not getting any coverage from their jobs.
Businesses can also cut hours to where everybody is under the 29 hours/week so as to be immune.
Businesses can cut the number of employees to under 50 to be under that threshold for coverage.

Again, if obamacare was going to be so good for businesses by allegedly decreasing tbe cost of healthcare, and thus the cost of doing business, then why the need for oppressive fines to get businesses to comply?

There was another article as well over the weekend about the huge impact on state budgets from the obamacare medicaid expansion. California alone is looking at an additional $1.2 billion cost added to their budget for the state portion of medicare expansion costs.

Before Obamacare was passed, AT&T announced that it cost the company $10,200 per year to insure the employee only. That insurance included medical, dental, vision and drug. The cost went up substantially with each dependent.

Not to be deterred, the CWA worked closely with the Democrats to get Obamacare passed, although not one AT&T worker would need that insurance or was uninsured after the normal probation period after being hired by AT&T. Weekly marches and knocking on doors by union members wearing CWA t-shirts promoting Obama care were normal fare, at least in Austin. Letter after letter went out to union members begging them to get involved in helping to pass Obamacare. Well, lo and behold, along comes the “Cadillac plan” penalty that would force employees to pay taxes on any health insurance plan that was over $10,600.00 per year, a measly $400/yr more than the cost to AT&T for their employees and CWA union members. Whew!! How great that Cadillac tax would not apply to all those loyal (Democrat) union members. Just lucky, right?

Only one problem; AT&T could drop all health, dental, vision and drug insurance plans for their employees, and their dependents, and would be required to pay a simple $2,000.00 year penalty for the employee only. So the average health insurance costs to AT&T for an average family would go from almost $30,000/yr to $2,000.00. Can anyone begin to comprehend the savings to AT&T?

What the union did not consider was the increase costs of health insurance, or that the company would not be willing to bear the costs of the absurd coverages that Nan mentioned above. And what do you know, the cost increases now put all the union members in the Cadillac plan limits where they are subjected to a 40% tax.

AT&T has already started to drop coverage on its retirees. Starting January 1, 2015, any retiree who will reach age 65 in 2015 will be thrown into the open market place (i.e. Obamacare). If a retiree is going to be 65 (and eligible for Medicare) in Dec. 2012, they will be forced to purchase health care insurance for almost a year. Also, vision care has been dropped for all dependents and any retiree over 65.

These retiree benefits are benefits that have been negotiated over the years at contract time with AT&T. These are benefits the union (CWA) touted to its members. It would be at no cost to the retiree and the retiree’s dependents. For the last two years, retirees have had to pay for that insurance, which becomes their secondary insurance after age 65. Now it seems that any retiree, or dependent, who has reached 65 will totally lose that secondary insurance after 1-1-2015.

The union touted the benefits of Obamacare. It sold its membership a bill of goods. And yet, the union is one of the biggest donors to the Democrat Party in the nation. How can AT&T workers be so blind? Their own union sold them out to support Obamacare and the Democrats who forced this atrocity on this nation. Every AT&T workers in a RTW state should drop out of the union today.

@retire05: One of the tenets of liberalism/socialism is to screw your neighbor to get what you want. It rarely happens that the screwers become the screwees by their own hand.

$36,500 per worker

Over the long term it might well be cheaper.