Newspaper article St Louis Post-Dispatch (MO)

Budget Deal Could Tighten Squeeze of 2013 Health Care Tax Increases; ECONOMY

Newspaper article St Louis Post-Dispatch (MO)

Budget Deal Could Tighten Squeeze of 2013 Health Care Tax Increases; ECONOMY

Article excerpt

WASHINGTON New taxes are coming Tuesday to help finance President Barack Obamas health care overhaul.

Most people may not notice. But they will pay attention if Congress decides to start taxing employer-sponsored health insurance, one option in play if lawmakers can ever agree on a budget deal to reduce federal deficits.

The tax hikes already on the books, taking effect in 2013, fall mainly on people who make lots of money and on the health care industry.

But about half of Americans benefit from the tax-free status of employer health insurance. Workers pay no income or payroll taxes on what their employer contributes for health insurance, and in most cases on their own share of premiums as well.

Its the single biggest tax break the government allows, outstripping the mortgage interest deduction, the deduction for charitable giving and other better-known benefits. If the value of job-based health insurance were taxed like regular income, it would raise nearly $150 billion in 2013, according to congressional estimates. By comparison, wiping away the mortgage interest deduction would bring in only about $90 billion.

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PARTIAL LIST OF TAXES AND FEES IN HEALTH CARE OVERHAUL

Starting in 2014, President Barack Obamas health care law will expand coverage to about 30 million uninsured people. At the same time, insurers will no longer be allowed to turn away those in poor health, and virtually every American will be required to have health insurance through an employer or a government program or by buying it on their own.

For the vast majority of people, the health care law wont mean sending more money to the Internal Revenue Service. But the wealthiest 2 percent of Americans will take the biggest hit, starting next year.

And roughly 20 million people eventually will benefit from tax credits that start in 2014 to help them pay insurance premiums.

A look at some of the major taxes and fees, estimated to raise nearly $700 billion over 10 years.

UPPER-INCOME HOUSEHOLDS

Starting Tuesday, individuals making more than $200,000 per year, and couples making more than $250,000, will face a 0. …

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