tag:blogger.com,1999:blog-44336184820483010492024-03-05T17:41:29.239-08:00Debreczeni & Petrash CPAs Tax BlogDebreczeni & Petrash CPAs has a proud tradition of service, technical expertise, and innovative thinking. Our staff combines experience and academic credentials to provide our clients with the depth of knowledge you'll find in larger firms while maintaining a personal one-on-one approach that smaller firms are known for.Anonymoushttp://www.blogger.com/profile/17070654285843529386noreply@blogger.comBlogger8125tag:blogger.com,1999:blog-4433618482048301049.post-23341688918887905552018-09-07T10:17:00.000-07:002018-09-07T10:17:14.677-07:004 QUESTIONS TO ASK BEFORE HIRING HOUSEHOLD HELP<div id="content" style="background-color: white;">
<div id="container">
<div class="content_title" style="text-align: center;">
<br /></div>
<div class="content_full">
<div class="first_letter" style="float: left;">
<i><span style="color: #0b5394;"><b><br /></b></span></i></div>
<div class="first_letter" style="float: left;">
<i><span style="color: #0b5394;"><b><br /></b></span></i></div>
<div class="first_letter" style="float: left;">
<i><span style="color: #0b5394;"><b><br /></b></span></i></div>
<div class="first_letter" style="float: left;">
<i><span style="color: #0b5394;"><b>W</b></span></i></div>
<i><span style="color: #0b5394;"><b>hen you hire someone to work in your home, you may have specific tax obligations, such as withholding and paying Social Security and Medicare (FICA) taxes and possibly federal and state unemployment insurance. </b></span></i><br />
<br />
Here are four questions to ask before you say, “You’re hired.”<br />
<br />
<b>1. Who’s considered a household employee?</b><br />
A household worker is someone you hire to care for your children or other live-in family members, clean your house, cook meals, do yard work or provide similar domestic services. But not everyone who works in your home is an employee.<br />
For example, some workers are classified as independent contractors. These self-employed individuals typically provide their own tools, set their own hours, offer their services to other customers and are responsible for their own taxes. To avoid the risk of misclassifying employees, however, you may want to assume that a worker is an employee unless your tax advisor tells you otherwise.<br />
<br />
<b>2. When do I pay employment taxes?</b><br />
You’re required to fulfill certain state and federal tax obligations for any person you pay $2,100 or more annually (in 2018) to do work in or around your house.<br />
In addition, you’re required to pay the employer’s half of FICA (Social Security and Medicare) taxes and to withhold the employee’s half. You must also pay federal unemployment taxes (FUTA) equal to 6% of the first $7,000 in cash wages. And, depending on your resident state, you may be required to make state unemployment contributions.<br />
<br />
<b>3. Are there exceptions?</b><br />
Yes. You aren’t required to pay employment taxes on wages you pay to your spouse, your child under age 21, your parent (unless an exception is met) or an employee who is under age 18 at any time during the year, providing that performing household work isn’t the employee’s principal occupation.<br />
<br />
<b>4. How do I make tax payments?</b><br />
You pay any federal employment and withholding taxes by attaching Schedule H to your Form 1040. You may have to pay state taxes separately and more frequently (usually quarterly). Keep in mind that this may increase your own tax liability at filing, though the Schedule H tax isn’t subject to estimated tax penalties.<br />
If you owe FICA or FUTA taxes or if you withhold income tax from your employee’s wages, you need an employer identification number (EIN).<br />
There’s no statute of limitations on the failure to report and remit federal payroll taxes. You can be audited by the IRS at any time and be required to pay back taxes, penalties and interest charges. Our firm can help ensure you comply with all the requirements.<br />
<br />
<b><i>At Debreczeni and Petrash we are fully prepared to take care of taxpayers, no matter the category they fall in. If you are currently a client, rest assured that we will guide you through this process. If you are not currently a client please visit <a href="http://www.debreczeni-petrash.com/">www.Debreczeni-Petrash.com</a> or call (440) 230-5660 and see if we are a good fit for your needs.</i></b><br />
<div>
<br /></div>
</div>
</div>
</div>
Anonymoushttp://www.blogger.com/profile/17070654285843529386noreply@blogger.com0tag:blogger.com,1999:blog-4433618482048301049.post-1277634348874569642015-01-20T09:29:00.005-08:002015-01-20T09:36:40.905-08:00Obamacare...What do I do?!<b><i><span style="color: #0b5394;">First...breath. Everything will be OK. Provided below is a summarized version of what you will need to know for the 2014 tax season:</span></i></b><br />
<br />
Beginning in 2014, all taxpayers were responsible for obtaining health insurance by March 31 for themselves and their dependents.<br />
<br />
Therefore there are 3 general scenarios taxpayers may find themselves in.<br />
<br />
<b>1. You had health insurance <u>not</u> purchased through Healthcare.gov ("The Exchange")</b><br />
<b><br /></b>
Inform your tax preparer of that fact and your work is over. If you have dependents that file their own taxes, your tax preparer needs copies of those before yours can be completed. Some people may receive a new form called Form 1095 from their insurance company. Bring this with you if one is received.<br />
<br />
<b>2. You had health insurance purchased through Healthcare.gov ("The Exchange")</b><br />
<b><br /></b>
You will receive a <u>Form 1095-A</u> in the mail before February. Bring this to your tax preparer. If you have dependents that file their own taxes, your tax preparer will need copies of those before yours can be completed.<br />
<br />
<b>3. You did not have health insurance</b><br />
<b><br /></b>
There may be a penalty that applies for non coverage. Certain exemptions are available to avoid paying a penalty.<br />
<br />
<u><i>Examples of Situations Exempt from Penalty</i></u><br />
- Covered through Medicare or Medicaid<br />
- Receive insurance through Retirement Systems<br />
- You did not earn enough income<br />
- You qualify for a Hardship Exemption (listed here <a href="https://www.healthcare.gov/fees-exemptions/hardship-exemptions/">https://www.healthcare.gov/fees-exemptions/hardship-exemptions/</a> )<br />
<br />
<b><i>At Debreczeni and Petrash we are fully prepared to take care of taxpayers, no matter the category they fall in. If you are currently a client, rest assured that we will guide you through this process. If you are not currently a client please visit <a href="http://www.debreczeni-petrash.com/">www.Debreczeni-Petrash.com</a> or call (440) 230-5660 and see if we are a good fit for your needs.</i></b>Anonymoushttp://www.blogger.com/profile/17070654285843529386noreply@blogger.com0tag:blogger.com,1999:blog-4433618482048301049.post-14301039746042851202013-11-23T20:35:00.000-08:002013-11-23T20:41:47.660-08:00Are you eligible for any of these tax credits? Don't forget!<i><b><span style="color: #0b5394;">Millions of Americans forgo critical refunds each year by failing to claim for tax credits. </span></b></i><br />
<span style="color: #0b5394;"><i>visit <a href="http://www.debreczeni-petrash.com/">www.debreczeni-petrash.com</a> for more info</i></span><br />
<br />
<div style="text-align: center;">
Are you eligible for any of these tax credits?<br />
<br />
<table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto; text-align: center;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiBCRiY-pqrmg4JaT1ua7K9X51aRO5Iesxywe-qQ6rrUa7NoEcl-ZjyQLL_KjIxZhZWotCU78RLoQY4NkKHNHt0y7M3mVzQnzOUC6do_p3poIaq7nZm0fHUb4IziUNfF9wBia7LsIg3fmGF/s1600/raining-money.jpg" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img border="0" height="200" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiBCRiY-pqrmg4JaT1ua7K9X51aRO5Iesxywe-qQ6rrUa7NoEcl-ZjyQLL_KjIxZhZWotCU78RLoQY4NkKHNHt0y7M3mVzQnzOUC6do_p3poIaq7nZm0fHUb4IziUNfF9wBia7LsIg3fmGF/s200/raining-money.jpg" width="135" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Worthwhile Knowledge</td></tr>
</tbody></table>
<br /></div>
<br />
A tax credit is a dollar-for-dollar reduction of taxes owed. Some credits are refundable – taxes could be reduced to the point that a taxpayer would receive a refund rather than owing any taxes. Below are some of the credits taxpayers could be eligible to claim:<br />
<br />
<b><span style="color: #38761d;"><i>Earned Income Tax Credit</i></span></b><br />
(EITC) is a federal tax credit for individuals who work but do not earn high incomes. Last year, an estimated 21 million taxpayers received approximately $37.5 billion in EITC. However, the IRS estimates that 25 percent of people who qualify don't claim the credit! When the EITC exceeds the amount of taxes owed, it results in a tax refund to those who claim and qualify for the credit. For more information, see IRS Publication 596, Earned Income Credit (EIC).<br />
<br />
<span style="color: #38761d;"><b><i>Child Tax Credit</i></b> </span><br />
This credit is for people who have a qualifying child. The maximum amount of the credit is $1,000 for each qualifying child. This credit can be claimed in addition to the credit for child and dependent care expenses. For more information on the Child Tax Credit, see Pub. 972, Child Tax Credit.<br />
<br />
<b><i><span style="color: #38761d;">Child and Dependent Care Credit </span></i></b><br />
This is for expenses paid for the care of children under age 13, or for a disabled spouse or dependent, to enable the taxpayer to work. There is a limit to the amount of qualifying expenses.<br />
<br />
<b><i><span style="color: #38761d;">Retirement Savings Contribution Credit </span></i></b><br />
Eligible individuals may be able to claim a credit for a percentage of their qualified retirement savings contributions, such as contributions to a traditional or Roth IRA or salary reduction contributions to a SEP or SIMPLE plan. To be eligible, you must be at least age 18 at the end of the year and not a student or an individual for whom someone else claims a personal exemption. For more information, see chapter four in Publication 590, Individual Retirement Arrangements (IRAs).<br />
<br />
<b><i><span style="color: #38761d;">Education Credits </span></i></b><br />
There are two credits available, the American Opportunity Credit (formerly called the Hope Credit) and the Lifetime Learning Credit, for people who pay higher education costs. The American Opportunity Credit is for the payment of the first two years of tuition and related expenses for an eligible student for whom the taxpayer claims an exemption on the tax return. The Lifetime Learning Credit is available for all post-secondary education for an unlimited number of years. A taxpayer cannot claim both credits for the same student in one year.<br />
<b><i><span style="color: #38761d;"><br /></span></i></b>
<b><i><span style="color: #38761d;">Adoption Credit </span></i></b><br />
Adoptive parents can take a tax credit of up to $13,170 for qualifying expenses paid to adopt an eligible child. For more information, see Pub. 968, Tax Benefits for Adoption.<br />
<br />
<b><i><span style="color: #38761d;">Credit for the Elderly and Disabled </span></i></b><br />
This credit is available to individuals who are either age 65 or older or are under age 65 and retired on permanent and total disability, and who are citizens or residents. For more information, see Pub.524, Credit for the Elderly or the Disabled.<br />
<br />
<br />
There are other credits available to eligible taxpayers. Please contact us so we may realize your specific situation, and offer advice. <a href="http://www.debreczeni-petrash.com/">www.Debreczeni-Petrash.com</a>Anonymoushttp://www.blogger.com/profile/17070654285843529386noreply@blogger.com0tag:blogger.com,1999:blog-4433618482048301049.post-67806979363626653422013-11-18T07:52:00.004-08:002013-11-24T13:00:38.081-08:00Tips for Donating to Charity Safely<div class="aboveUnitContent" style="background-color: white; font-family: 'lucida grande', tahoma, verdana, arial, sans-serif; font-size: 11px; line-height: 14px; margin-bottom: 15px; margin-top: 15px;">
<div class="userContentWrapper">
<div class="_wk" style="font-size: 13px; line-height: 18px;">
<span class="userContent"><i><span style="color: #0b5394;">It is common for scam artists to impersonate charities to get money or private information from taxpayers. The IRS has offered a number of tips for taxpayers to follow in making donations</span></i><span style="color: #333333;">:</span><br /><br /><span style="color: #333333;"><b>1</b>. Donate to <u>recognized charities</u> to help disaster</span><span class="text_exposed_show" style="color: #333333; display: inline;"> victims. Scammers operating bogus charities may contact people by telephone, social media, email or in-person to solicit money or financial information.<br /><br /><b>2</b>. Scammers often send e-mail that steers the recipient to bogus websites that appear to be affiliated with legitimate charitable causes.<br /><br /><b>3</b>. Be wary of charities with names that are similar to nationally known organizations. Fraudulent sites frequently mimic the sites of, or use names similar to, legitimate charities to persuade people to send money or provide personal financial information.<br /><br /><b>4</b>. Consider using the search feature, "<a href="http://www.irs.gov/Charities-&-Non-Profits/Exempt-Organizations-Select-Check" target="_blank">Exempt Organizations Select Check</a>," on the IRS website, which allows people to find legitimate, qualified charities to which donations may be tax-deductible.<br /><br /><b>5</b>. <u>Don't give out personal financial information</u>, such as Social Security numbers or credit card and bank account numbers and passwords, to anyone who solicits a contribution from you. This information may be used by scam artists to steal your identity and money.<br /><br /><b>6</b>. Don't give or send cash. For security and tax record purposes, <u>contribute by check or credit card</u> or another way that provides documentation of the gift.</span></span></div>
</div>
</div>
<div class="photoUnit clearfix" style="background-color: white; color: #333333; font-family: 'lucida grande', tahoma, verdana, arial, sans-serif; font-size: 11px; line-height: 14px; margin: 0px -15px; position: relative; zoom: 1;">
<div class="_53s uiScaledThumb photo photoWidth1" data-ft="{"tn":"E"}" data-gt="{"fbid":"557110354365891"}" style="float: left; position: relative;">
<a ajaxify="https://www.facebook.com/photo.php?fbid=557110354365891&set=a.380848988658696.89928.362502243826704&type=1&relevant_count=1&src=https%3A%2F%2Fscontent-a-ord.xx.fbcdn.net%2Fhphotos-frc3%2F1466269_557110354365891_1260234184_n.jpg&size=300%2C299&theater&source=9" class="_6i9" href="http://www.debreczeni-petrash.com/" rel="theater" style="color: #3b5998; cursor: pointer; text-decoration: none;" target="_blank"><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto; text-align: center;"><tbody>
<tr><td style="text-align: center;"><img alt="Photo: It is common for scam artists to impersonate charities to get money or private information from taxpayers. The IRS has offered a number of tips for taxpayers to follow in making donations:
1. Donate to recognized charities to help disaster victims. Scammers operating bogus charities may contact people by telephone, social media, email or in-person to solicit money or financial information.
2. Scammers often send e-mail that steers the recipient to bogus websites that appear to be affiliated with legitimate charitable causes.
3. Be wary of charities with names that are similar to nationally known organizations. Fraudulent sites frequently mimic the sites of, or use names similar to, legitimate charities to persuade people to send money or provide personal financial information.
4. Consider using the search feature, "Exempt Organizations Select Check," on the IRS website, which allows people to find legitimate, qualified charities to which donations may be tax-deductible.
5. Don't give out personal financial information, such as Social Security numbers or credit card and bank account numbers and passwords, to anyone who solicits a contribution from you. This information may be used by scam artists to steal your identity and money.
6. Don't give or send cash. For security and tax record purposes, contribute by check or credit card or another way that provides documentation of the gift." class="img" src="https://scontent-a-ord.xx.fbcdn.net/hphotos-frc3/p480x480/1466269_557110354365891_1260234184_n.jpg" style="border: 0px; left: 0px; margin-left: auto; margin-right: auto; min-height: 100%; position: relative;" /></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Let Debreczeni & Petrash help keep your donations safe</td></tr>
</tbody></table>
</a></div>
</div>
<div class="separator" style="clear: both; text-align: center;">
</div>
Anonymoushttp://www.blogger.com/profile/17070654285843529386noreply@blogger.com0tag:blogger.com,1999:blog-4433618482048301049.post-40852526758446597732013-11-15T10:33:00.000-08:002013-11-15T10:54:12.069-08:00When to Start Receiving Social Security Benefits<div style="font-family: Arial; font-size: small;">
<i>As you approach retirement age, you must decide whether to begin taking reduced social security benefits early or wait until full benefit retirement age (FBRA). In many cases, this decision will depend on factors other than</i> <i>trying to receive the greatest lifetime</i><img align="right" border="0" height="161" src="http://167.68.20.83/2000-05/images/Nov_2013/page1.jpg" width="239" /><i> benefit from social security.</i> </div>
<div style="font-family: Arial; font-size: small;">
<br /></div>
<div style="font-family: Arial; font-size: small;">
Remember that while you have the option of receiving social security benefits as early as age 62, the eligibility age for Medicare remains at 65. So, although you may be able to replace a sufficient amount of your earned income with social security benefits beginning at age 62, you may not be able to adequately replace your employer-provided health insurance.</div>
<div style="font-family: Arial; font-size: small;">
<br /></div>
<div style="font-family: Arial; font-size: small;">
Even if you have sufficient funds to live on without considering social security, many people prefer to begin receiving benefits as soon as possible. For 2013, the benefits at age 62 are reduced by 25% of what they would be at age 66 (i.e., the FBRA); but, you will receive more social security checks if benefits are drawn early. In addition, drawing early social security benefits may allow you to leave tax-deferred retirement accounts untouched and growing for longer periods.</div>
<div style="font-family: Arial; font-size: small;">
<br /></div>
<div style="font-family: Arial; font-size: small;">
Another reason to receive benefits early is if you have children living at home. Children under age 18 (or up to 19 if a full-time student) may be eligible for benefits if you are also receiving social security benefits.</div>
<div style="font-family: Arial; font-size: small;">
<br /></div>
<div style="font-family: Arial; font-size: small;">
<br /></div>
<div style="font-family: Arial; font-size: small;">
<b><i><span style="color: #0b5394;">You might carefully consider the long-lasting advantages of waiting until FBRA based on the following factors.</span></i></b></div>
<div style="font-family: Arial; font-size: small;">
<br /></div>
<div style="font-family: Arial; font-size: small;">
<b>Life Expectancy. </b>Your life expectancy may be the biggest factor in deciding whether to receive benefits early. By age 62, you should have a good handle on your own life expectancy based on your current health and the longevity of your parents. In general, 77 years might be a good cutoff point. If you reasonably expect to reach that age, waiting until FBRA may be a wise choice.</div>
<div style="font-family: Arial; font-size: small;">
<br /></div>
<div style="font-family: Arial; font-size: small;">
<b>Shortening the Retirement Period.</b> A significant factor in retirement planning projections is the length of the retirement period. For example, if you want to retire at age 62 and you have a life expectancy of 85, you have a 23-year retirement period to fund. By working past age 62, you are shortening the retirement period and lowering the amount of money needed to fund your retirement regardless of longevity.</div>
<div style="font-family: Arial; font-size: small;">
<br /></div>
<div style="font-family: Arial; font-size: small;">
<b>The Earnings Test. </b>If you are considering receiving retirement benefits before your FBRA but you intend to keep working, you must consider the earnings test. For 2013, social security benefits are reduced $1 for every $2 in earnings above the exempt amount of $15,120.</div>
<div style="font-family: Arial; font-size: small;">
<br /></div>
<div style="font-family: Arial; font-size: small;">
<b>Replacing Lower-wage Years.</b> Your social security benefits are calculated based on your highest 35 years of indexed earnings. If you can replace lower-wage years early in your career with higher-wage years after age 62, the benefit can be increased. This can lead to a greater benefit when you retire.</div>
<div style="font-family: Arial; font-size: small;">
<br /></div>
<div style="font-family: Arial; font-size: small;">
<img align="right" border="0" height="154" src="http://167.68.20.83/2000-05/images/Nov_2013/page1a.jpg" width="240" /></div>
<div style="font-family: Arial; font-size: small;">
<b>Inflation Adjustments.</b> Social security benefits receive an annual inflation adjustment. By taking early benefits, your starting base for these annual adjustments is smaller. For example, if your benefit was $1,000, but you retired early and received only $750, each year you would miss out on the compounded inflation adjustment of that $250 in lost benefits. In other words, the gap between the early retirement benefit you receive and the amount you would have received by waiting will get bigger and bigger.</div>
<div style="font-family: Arial; font-size: small;">
<br /></div>
<div style="font-family: Arial; font-size: small;">
<b>The Effect on Your Spouse.</b> Your decision to start receiving social security benefits before reaching FBRA may also affect your spouse’s benefits. If your spouse does not have a personal earnings record, he or she will only receive half of your retirement benefit.</div>
<div style="font-family: Arial; font-size: small;">
<br /></div>
<div style="font-family: Arial; font-size: small;">
<b>After FBRA. </b>If you delay receiving benefits until after your FBRA, you will receive larger benefits because of the delayed retirement credit. You may receive a credit of up to 8% per year for each year you delay receiving benefits until age 70.</div>
<div style="font-family: Arial; font-size: small;">
If you are able to wait, the delayed retirement credit can have a significant impact. In addition to the higher retirement benefit you will receive, you will also shorten your retirement period and increase your spouse’s survivor’s benefit.</div>
Anonymoushttp://www.blogger.com/profile/17070654285843529386noreply@blogger.com0tag:blogger.com,1999:blog-4433618482048301049.post-81359171485547270992013-11-11T06:59:00.000-08:002013-11-11T07:02:15.555-08:00Residency Issues for Retirees and Home Office Deductions<table cellspacing="0" id="ecxpage" style="background-color: white; border: 0px; color: #343434; font-family: Verdana, Arial, san-serif; font-size: 15px; line-height: 21px; margin: 0px; padding: 0px; width: 600px;"><tbody style="border: 0px; margin: 0px; padding: 0px;">
<tr style="border: none; margin: 0px; padding: 0px;"><td style="border: 0px; margin: 0px; padding: 15px; text-align: center;"><a href="http://www.debreczeni-petrash.com/">Debreczeni-Petrash.com</a></td></tr>
<tr style="border: none; margin: 0px; padding: 0px;"><td id="ecxcontent" style="border: 0px; font-size: 11px; line-height: 15px; margin: 0px; padding: 15px;"><strong style="border: 0px; margin: 0px; padding: 0px;">Residency Issues for Retirees<br /></strong><div style="border: 0px; margin-bottom: 1.35em; padding: 0px;">
With 10,000 baby boomers turning 65 each day, some may decide to move to another state for a variety of reasons. These include living in a warmer climate, being closer to children or other relatives, avoiding state income tax, health reasons, or a combination thereof. <i>But, states and municipalities are looking for every available dollar to shore up shrinking budgets. So retirees should use caution to avoid being overtaxed due to a move.</i></div>
<div style="border: 0px; margin-bottom: 1.35em; padding: 0px;">
If the retiree's move is intended to be permanent, it is important that legal domicile be established in the new state. If domicile is not established, the retiree may be subject to income tax as a resident of both the old and new states. In addition, since each state has its own rules relating to residence and domicile, both states may try to impose taxes on the retiree even if he or she has established domicile in the new state, but has not adequately relinquished domicile in the previous state.</div>
<div style="border: 0px; margin-bottom: 1.35em; padding: 0px;">
Furthermore, if the retiree dies without establishing domicile, both the old and the new states may claim jurisdiction over the retiree's estate.</div>
<div style="border: 0px; margin-bottom: 1.35em; padding: 0px;">
The more time that elapses after the move and the more steps the retiree takes to establish domicile in the new state, the more difficult it will be for the old state to assert that the retiree resides or has domicile there.</div>
<div style="border: 0px; margin-bottom: 1.35em; padding: 0px;">
The following steps tend to establish domicile in a new state:</div>
<ul style="border: 0px; margin: 0px 0px 20px 1em; padding: 0px 0px 0px 1em;">
<li style="border: 0px; margin: 0px 0px 3px; padding: 0px;">Register to vote in the new location.</li>
<li style="border: 0px; margin: 0px 0px 3px; padding: 0px;">File a change of address form with the post office at the old location and change the address on documents, such as tax returns, wills, contracts, insurance policies, passports, and living trust agreements.</li>
<li style="border: 0px; margin: 0px 0px 3px; padding: 0px;">Obtain a driver's license and register automobiles in the new location.</li>
<li style="border: 0px; margin: 0px 0px 3px; padding: 0px;">Open and use bank accounts in the new location.</li>
<li style="border: 0px; margin: 0px 0px 3px; padding: 0px;">Move items from safe deposit boxes in the old location to the new location.</li>
<li style="border: 0px; margin: 0px 0px 3px; padding: 0px;">Purchase or lease a residence in the new state and sell the residence in the old state.</li>
<li style="border: 0px; margin: 0px 0px 3px; padding: 0px;">If an income tax return is required, file a resident return in the new state and a nonresident return (or no return, if appropriate) in the old state.</li>
<li style="border: 0px; margin: 0px 0px 3px; padding: 0px;">File for property tax relief under a homestead exemption (if any) in the new state.</li>
</ul>
<div style="border: 0px; margin-bottom: 1.35em; padding: 0px;">
For many purposes, the location of property is determined by reference to state law, and legally may be deemed to be somewhere other than where the property is physically located. The state in which the property is deemed to be located may assess income taxes (if any) on income or gains relating to the property. The state may also assess death and succession taxes, and that state will be where probate proceedings will occur when the individual dies. Furthermore, rules of that state will be used to determine whether testamentary instruments are valid and whether the terms of the instruments (such as the powers of a trustee) are legally enforceable.</div>
<div style="border: 0px; margin-bottom: 1.35em; padding: 0px;">
The retiree's state of domicile generally determines the rules relating to the ownership and tax treatment of intangible personal property. Thus, if the retiree established domicile in a new state, that state's laws generally will apply to his or her intangible assets, such as bank accounts, stocks, bonds, notes, partnership interests, trust income rights, and insurance contracts. Interest income from a savings account, for example, will normally be taxed by the state of domicile, rather than the state in which the account is located.</div>
<strong style="border: 0px; margin: 0px; padding: 0px;">New Simplified Home Office Deduction<br /></strong><div style="border: 0px; margin-bottom: 1.35em; padding: 0px;">
The IRS recently announced a simplified option that many owners of home-based businesses and some home-based workers may use to figure their deductions for the business use of their homes. The new optional deduction, capped at $1,500 per year based on $5 a square foot for up to 300 square feet, will reduce the paperwork and record-keeping burden on small businesses. The new option is available beginning in 2013.</div>
<div style="border: 0px; margin-bottom: 1.35em; padding: 0px;">
Though homeowners using the new option cannot depreciate the portion of their home used in a trade or business, they can claim allowable mortgage interest, real estate taxes, and casualty losses on the home as itemized deductions on Schedule A, if they choose to itemize their deductions. These deductions need not be allocated between personal and business use, as is required under the regular method.</div>
<div style="border: 0px; margin-bottom: 1.35em; padding: 0px;">
Business expenses unrelated to the home, such as advertising, supplies, and wages paid to employees, can still be fully deductible. Current restrictions on the home office deduction, such as the requirement that a home office must be used regularly and exclusively for business and the limit tied to the income derived from the particular business, still apply under the new option.</div>
<div style="border: 0px; margin-bottom: 1.35em; padding: 0px;">
In tax year 2010, the most recent year for which figures are available, the IRS indicates nearly 3.4 million taxpayers claimed deductions for business use of a home. Please contact us if you would like more information on the home office deduction or any other tax compliance or planning issue.</div>
<div style="border: 0px; margin-bottom: 1.35em; padding: 0px;">
<br /></div>
<div style="border: 0px; margin-bottom: 1.35em; padding: 0px;">
For More Information Please Visit <a href="http://www.debreczeni-petrash.com/">Debreczeni-Petrash.com</a></div>
</td></tr>
</tbody></table>
Anonymoushttp://www.blogger.com/profile/17070654285843529386noreply@blogger.com0tag:blogger.com,1999:blog-4433618482048301049.post-29615652606419569172013-11-07T07:18:00.001-08:002013-11-07T07:19:24.015-08:00Save Taxes When Paying Health Care Costs<div class="MsoNormal" style="background: white; line-height: 14.25pt; margin-bottom: 16.2pt;">
<span style="color: #222222; font-family: Arial, sans-serif; font-size: 10.5pt; line-height: 14.25pt;">There are four types
of tax-advantaged accounts that can be used to pay for unreimbursed medical
expenses: (1) Health Care Flexible Spending Accounts (<b>FSA</b>s), (2) Health
Reimbursement Accounts (<b>HRA</b>s), (3) Health Savings Accounts (<b>HSA</b>s), and (4)
Archer Medical Savings Accounts (<b>MSA</b>s). </span></div>
<div class="MsoNormal" style="background-color: white; background-position: initial initial; background-repeat: initial initial; line-height: 14.25pt; margin-bottom: 16.2pt; text-align: center;">
<i><span style="color: #222222; font-family: "Arial","sans-serif"; font-size: 10.5pt; mso-fareast-font-family: "Times New Roman";">Comparison of the four
types of accounts</span></i><span style="color: #222222; font-family: "Arial","sans-serif"; font-size: 10.5pt; mso-fareast-font-family: "Times New Roman";"> <o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: 14.25pt; margin-bottom: 16.2pt;">
<span style="color: #222222; font-family: "Arial","sans-serif"; font-size: 10.5pt; mso-fareast-font-family: "Times New Roman";"><b><i>FSA</i></b>s. These are
employer-established arrangements that are usually funded through salary
reduction agreements. The employee's contribution isn't
subject to either income or employment taxes. Under the ACA, beginning in 2013,
FSA contributions are limited to $2,500 per employee. <o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: 14.25pt; margin-bottom: 16.2pt;">
<span style="color: #222222; font-family: "Arial","sans-serif"; font-size: 10.5pt; mso-fareast-font-family: "Times New Roman";"><b><i>HRA</i></b>s. These are
employer-established arrangements that are funded only through employer
contributions. HRA contributions are not subject to either income or employment
taxes and health care benefits used for medical care are
tax exempt. <o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: 14.25pt; margin-bottom: 16.2pt;">
<span style="color: #222222; font-family: "Arial","sans-serif"; font-size: 10.5pt; mso-fareast-font-family: "Times New Roman";">HRAs are group health
plans that typically consist of a promise by an employer to reimburse medical
expenses for a year up to a certain amount,
with unused amounts available to reimburse medical expenses in future years.
That causes a problem under Sec. 2711 of the Public Health Service Act (PHSA),
as added by the ACA, which generally prohibits plans and issuers from imposing
lifetime or annual limits on the dollar value of essential health benefits. IRS
has ruled that HRAs are permitted when they are integrated with other
employer-provided coverage, and are not permitted when they are stand-alone
accounts. <o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: 14.25pt; margin-bottom: 16.2pt;">
<span style="color: #222222; font-family: "Arial","sans-serif"; font-size: 10.5pt; mso-fareast-font-family: "Times New Roman";"><b><i>HSA</i></b>s. These are
tax-exempt accounts that can be established (and to which
contributions can be made) only when the account owner has a qualifying high
deductible health insurance plan (HDHP). For example, for 2013 as well as 2014,
the plan must have a deductible of at least $1,250 for self-only coverage and
$2,500 for family coverage.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: 14.25pt; margin-bottom: 16.2pt;">
<span style="color: #222222; font-family: "Arial","sans-serif"; font-size: 10.5pt; mso-fareast-font-family: "Times New Roman";">For 2013, annual
out-of-pocket expenses (deductibles, co-pays, and other amounts, but not
premiums) can't exceed $6,250 for self-only coverage or $12,500 for family
coverage (for 2014, $6,350 and $12,700 respectively). The plan holder may have
no other major medical health insurance policy. Contributions made by employers
are exempt from income and employment taxes, and account owners may deduct
contributions they make. Withdrawals for medical expenses are not taxed. Unused balances may
be carried over from year to year. Contributions for 2013 are
limited to $3,250 for self-only coverage and $6,450 for family coverage (for
2014, $3,300 and $6,550 respectively). An additional contribution of $1,000 is
allowed to people age 55 and older.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: 14.25pt; margin-bottom: 16.2pt;">
<span style="color: #222222; font-family: "Arial","sans-serif"; font-size: 10.5pt; mso-fareast-font-family: "Times New Roman";"><b><i>MSA</i></b>s. These accounts,
also known as Archer MSAs, are earlier versions of HSAs and are in limited use
under current law. MSAs can be established generally only
when account owners have qualifying high deductible insurance and no other coverage.
Contributions made by employers are exempt from income and employment taxes,
and contributions by account owners (which are allowed only if the employer
doesn't contribute) are deductible. Withdrawals are not taxed if used for
medical expenses. Unused balances may be carried over from year to year
without limit.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: 14.25pt; margin-bottom: 16.2pt;">
<span style="color: #222222; font-family: "Arial","sans-serif"; font-size: 10.5pt; mso-fareast-font-family: "Times New Roman";">The principal
difference between HSAs and MSAs is that MSA eligibility is limited to people
who are self-employed or employed by a small employer (50 or fewer employees,
on average). In addition, the MSA minimum deductible levels are higher and the
contribution limits are lower. Generally, no MSAs can be created after
Dec. 31, 2007, although MSAs existing at that time are grandfathered. <o:p></o:p></span></div>
<div class="MsoNormal" style="background-color: white; background-position: initial initial; background-repeat: initial initial; line-height: 14.25pt; margin-bottom: 16.2pt; text-align: center;">
<i><span style="font-family: Arial, Helvetica, sans-serif;"><br /></span></i></div>
<div class="MsoNormal" style="background-color: white; background-position: initial initial; background-repeat: initial initial; line-height: 14.25pt; margin-bottom: 16.2pt; text-align: center;">
<i><span style="font-family: Arial, Helvetica, sans-serif;">National statistics</span></i></div>
<div class="MsoNormal" style="background-color: white; background-position: initial initial; background-repeat: initial initial; line-height: 14.25pt; margin-bottom: 16.2pt; text-align: center;">
<span style="color: #222222; font-family: Arial, sans-serif; font-size: 10.5pt; line-height: 14.25pt;"><i>40% of all civilian workers in 2012 had access
to a health care FSA. When viewed by firm size, 53% of civilian workers in
firms with 100 or more workers had access to an FSA. In establishments with
fewer than 100 employees, 20% of the workers had access to a health care FSA.</i></span></div>
<div class="MsoNormal" style="background-color: white; background-position: initial initial; background-repeat: initial initial; line-height: 14.25pt; margin-bottom: 16.2pt; text-align: center;">
<span style="color: #222222; font-family: Arial, sans-serif; font-size: 10.5pt; line-height: 14.25pt;"><i>HSAs are only available to employees who have
HDHPs. In 2012, 26% of firms offering health benefits offered an HSA-qualified
HDHP (up from 18% in 2011 and 12% in 2010). Workers in larger firms were more
likely to have access to an HDHP than those in smaller firms.</i></span></div>
<div class="MsoNormal" style="background-color: white; background-position: initial initial; background-repeat: initial initial; line-height: 14.25pt; margin-bottom: 16.2pt; text-align: center;">
<span style="color: #222222; font-family: Arial, sans-serif; font-size: 10.5pt; line-height: 14.25pt;"><i>Although employers are not required to
restrict HRA benefits to employees with HDHPs, most employers chose to do so.
Of employers offering health benefits, there was no discernible upward or
downward trend in the percent who offered an HDHP and an HRA in recent years;
the percentage was 4% in 2010, 7% in 2011, and 5% in 2012.</i></span></div>
<div class="MsoNormal" style="background-color: white; background-position: initial initial; background-repeat: initial initial; line-height: 14.25pt; margin-bottom: 16.2pt; text-align: center;">
<span style="color: #222222; font-family: Arial, sans-serif; font-size: 10.5pt; line-height: 14.25pt;"><i>The CRS report says
that almost no data is available on usage of MSAs, as very few new MSAs are
being created, and the number of them always has been limited.</i></span></div>
Anonymoushttp://www.blogger.com/profile/17070654285843529386noreply@blogger.com0tag:blogger.com,1999:blog-4433618482048301049.post-77328619267251437872012-07-04T12:22:00.003-07:002013-11-06T09:29:06.496-08:00Tax Highlights Obamacare<br />
<table><tbody>
<tr><td><span class="blog-date">Posted Wednesday, July 04, 2012</span></td></tr>
<tr>
<td>
<br />
<div style="text-align: center;">
<b><span style="font-family: Times, serif; font-size: 13pt;">HIGHLIGHTS OF PPACA/HCERA AND
IRS GUIDANCE</span></b></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt; text-align: left;">
The Supreme Court has left standing all tax provisions
within PPACA and HCERA. This decision, which was unexpected by many
Court-watchers, brings with it a sense of urgency to employers, individuals and
other stakeholders that time is now g</div>
<table><tbody>
<tr></tr>
</tbody></table>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt; text-align: left;">
rowing short both to prepare for those
major changes soon to take place in 2013 and 2014 and also to implement
provisions or benefits that are already effective and available.</div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt; text-align: left;">
<i>The PPACA and HCERA add to or amend numerous sections
of the Internal Revenue Code, resulting in the largest set of tax law changes in
more than 20 years. The IRS has been working on many fronts to issue guidance on
these provisions, to flesh out certain benefits and requirements, and to set up
procedures necessary for compliance.</i><i><o:p></o:p></i></div>
<div class="MsoNoSpacing">
<i>The remainder of this
Briefing <span style="background-color: yellow;">highlights the major tax
provisions</span> of PPACA and HCERA, and the guidance that has been developed
since enactment.</i><o:p></o:p></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<b><span style="font-family: Times, serif;">INDIVIDUAL
TAX PROVISIONS</span></b><b><span style="font-family: Times, serif;"><o:p></o:p></span></b></div>
<br />
<div class="MsoNoSpacing">
<b><i><br /></i></b></div>
<div class="MsoNoSpacing">
<b><i>Individual
Mandate</i></b><b><i><o:p></o:p></i></b></div>
<div class="MsoNoSpacing">
The PPACA requires
applicable individuals to carry minimum essential health coverage for themselves
and their dependents (also known as the individual mandate) or otherwise pay a
shared responsibility penalty for each month of noncompliance. The individual
mandate provision is scheduled to be effective beginning in calendar year 2014.
"The individual mandate requires most Americans to maintain ‘minimum essential’
health insurance coverage," Chief Justice Roberts wrote. "For individuals who
are not exempt and do not receive health insurance through a third party, the
means of satisfying the requirement is to purchase insurance from a private
company."<o:p></o:p></div>
<div class="MsoNoSpacing">
<b><i><br /></i></b></div>
<div class="MsoNoSpacing">
<b><i>Individuals who are exempt.</i></b> Some individuals
are exempt from the individual mandate. They include (not an exhaustive list)
individuals covered by Medicaid and Medicare, incarcerated individuals,
individuals not lawfully present in the United States, health care ministry
members, members of an Indian tribe, and members of a religion conscientiously
opposed to accepting benefits. No penalty will be imposed on individuals without
coverage for fewer than 90 days (with only one period of 90 days allowed in a
year). Generally, individuals with employer-provided health insurance, if it
satisfies minimum essential coverage and affordability requirements, are also
exempt.</div>
<div class="MsoNoSpacing">
<o:p></o:p></div>
<div class="MsoNoSpacing">
<br /></div>
<div class="MsoNoSpacing">
Additionally, no penalty
will be imposed on individuals who are unable to afford coverage (generally, an
individual will be treated as unable to afford coverage if the required
contribution for employer-sponsored coverage or a bronze-level plan on an
Exchange exceeds eight percent of the individual's household income for the tax
year). Those applicable individuals whose household income is below their income
thresholds for filing income tax returns are also exempt.<o:p></o:p></div>
<br />
<div class="MsoNoSpacing">
<b><i><br /></i></b></div>
<div class="MsoNoSpacing">
<b><i>Minimum essential
coverage.</i></b> Under the PPACA, minimum essential coverage generally includes
(not an exhaustive list) coverage under an eligible employer-sponsored plan, an
individual market plan, a grandfathered health plan (discussed below), coverage
under Medicaid and Medicare, and other government-sponsored coverage, subject to
some exceptions.</div>
<div class="MsoNoSpacing">
<b><i><br /></i></b></div>
<div class="MsoNoSpacing">
<b><i>Calculating the
penalty.</i></b> The penalty is generally calculated by taking the greater of a
flat dollar amount and a calculation based on a percentage of the taxpayer's
household income, and is imposed on a monthly basis (one-twelfth per month of
this ‘greater of ’ amount). The annual flat dollar amount is assessed per
individual or dependent without coverage and is scheduled to be phased in over
three years ($95 for 2014; $325 for 2015; and $695 in 2016 and subsequent years,
indexed for inflation after 2016; onehalf of these amounts for individuals under
the age of 18). The flat dollar amount is compared to a percentage of the extent
to which the taxpayer's household income exceeds the income tax filing
threshold. The applicable percentage is 1 percent for 2014, 2 percent for 2015,
and 2.5 percent for 2016 and subsequent years. The taxpayer's penalty is equal
to the greater of the flat dollar amount or the percentage of household income.
The amount cannot exceed the national average of the annual premiums of a
"bronze level" health insurance plan offered through a health
exchange.<o:p></o:p></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<b><span style="font-family: Times, serif;">Premium
Assistance Tax Credit</span></b><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-family: Times, serif;">Beginning in
2014, eligible lower-income individuals who obtain coverage under a qualified
health plan through an insurance exchange may qualify for a premium assistance
tax credit under </span><span style="font-family: 'Times','serif';"><a href="http://prod.resource.cch.com/resource/scion/citation/pit/S36B/STB-IRC?cfu=TAA"><span style="color: blue;">Code Sec. 36B</span></a> unless they are eligible for other minimum essential
coverage, including employer-sponsored coverage that is affordable and provides
minimum value. The PPACA provides that advance payments of the premium
assistance tax credit may be made directly to the insurer.
<b style="font-size: 12pt;"> </b><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Medical
Deduction Threshold</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The PPACA <span style="background-color: yellow;">increases the threshold to claim an itemized
deduction for unreimbursed medical expenses from 7.5 percent of adjusted gross
income (AGI) to 10 percent of AGI</span> for tax years beginning after December
31, 2012. However, individuals (or their spouses) age 65 and older before the
close of the tax year are exempt from the increased threshold, and the 7.5
percent threshold continues to apply until after 2016.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div align="center" class="MsoNormal" style="margin: 8.5pt 0in 0pt; text-align: center;">
<span style="font-size: 12pt;"><b><span style="font-family: Times, serif;">HEALTH CARE TAX CREDIT</span></b></span><span style="font-family: 'Times','serif'; font-size: 12pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The Health Care
Tax Credit (HCTC) was extended and enhanced by the Trade Adjustment Assistance
Act of 2011 (TAA 2011). The HCTC is refundable and can also be advanced.
Individuals eligible for the HCTC include individuals receiving Trade Adjustment
Allowances; individuals receiving wage subsidies in the form of Reemployment
Trade Adjustment Assistance (RTAA) benefits; and individuals between the ages of
55 and 64 receiving payments from the Pension Benefit Guaranty Corporation
(PBGC). The HCTC is scheduled to sunset after 2013.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Additional
Tax On HSA/MSA Distributions</span></i></b></span><span style="font-family: 'Times','serif'; font-size: 12pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">Distributions
from a health savings account (HSA) or Archer medical savings account (Archer
MSA) not used for the beneficiary's qualified medical expenses are generally
included in the beneficiary's gross income. Distributions included in gross
income are subject to an additional tax of 10 percent of the included amount,
unless made after the beneficiary's death, disability, or attainment of the age
of Medicare eligibility. Effective for distributions made after December 31,
2010, the additional tax on HSAs and Archer MSAs <span style="background-color: yellow;">increases from 10 percent to 20 percent</span>,
in the case of HSAs, and from 15 percent to 20 percent, in the case of Archer
MSAs, of the amount included in gross income.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Additional
Medicare Tax</span></i></b></span><span style="font-family: 'Times','serif'; font-size: 12pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">For tax years
beginning after December 31, 2012, <span style="background-color: yellow;">an
additional 0.9 percent Medicare tax is imposed on wages and self-employment
income of higher-income individuals.</span> The additional Medicare tax applies
to individuals with remuneration in excess of $200,000; married couples filing a
joint return with <span style="background-color: yellow;">incomes in excess of
$250,000</span>; and married couples filing separate returns with incomes in
excess of $125,000.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Medicare
Tax On Investment Income</span></i></b></span><span style="font-family: 'Times','serif'; font-size: 12pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="background-color: yellow; font-family: Times, serif;">The PPACA imposes a
3.8 percent Medicare contribution tax on unearned income effective for tax years
beginning after December 31, 2012.</span><span style="font-family: Times, serif;"> The tax is imposed on the lesser of an
individual's net investment income for the tax year or modified adjusted gross
income in excess of $200,000 ($250,000 for married couples filing a joint return
and $125,000 for married couples filing a separate return).</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 4.25pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="background-color: yellow; font-family: Times, serif;">Net investment
income</span><span style="font-family: Times, serif;"> is the excess of the sum
of the following items less any otherwise allowable deductions properly
allocable to such income or gain:</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 0in 0in 0pt 42.5pt; text-indent: -42.5pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;"> </span><span style="font-family: 'Times New Roman', serif;">-</span><span style="font-family: Times, serif;"> <span style="background-color: yellow;">Gross
income from interest, dividends, annuities, royalties and rents</span> unless
such income is derived in the ordinary course of any trade or business
(excluding a passive activity or financial instruments/commodities
trading);</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 0in 0in 0pt 42.5pt; text-indent: -42.5pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;"> </span><span style="font-family: 'Times New Roman', serif;">-</span><span style="font-family: Times, serif;"> Other gross <span style="background-color: yellow;">income from any passive trade or
business</span>; and</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 0in 0in 0pt 42.5pt; text-indent: -42.5pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;"> </span><span style="font-family: 'Times New Roman', serif;">-</span><span style="font-family: Times, serif;"> <span style="background-color: yellow;">Net
gain included in computing taxable income</span> that is attributable to the
disposition of property other than property held in any trade or business that
is not a passive trade or business.</span></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Indoor
Tanning Excise Tax</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">Amounts paid for
indoor tanning services performed after June 30, 2010, are subject to a 10
percent excise tax. Tanning salons are responsible for collecting the excise tax
and paying over the tax on a quarterly basis. Tanning salons that fail to
collect the tax from patrons are liable for the excise tax.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Dependent
Coverage Until Age 26</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The PPACA also
requires group health plans and health insurance issuers providing dependent
coverage for children to continue to make the coverage available for an adult
child until turning age 26. The coverage requirement is effective for the first
plan year beginning on or after September 23, 2010.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 5.65pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The IRS issued
temporary regulations in TD 9482 (5/10/10). The IRS explained that, with respect
to a child who has not attained age 26, a plan or issuer may not define
dependent for purposes of eligibility for dependent coverage for children other
than in terms of a relationship between a child and the participant. A plan or
issuer may not deny or restrict coverage for a child who has not attained age 26
based on the presence or absence of the child's financial dependency (upon the
participant or any other person), residency with the participant or with any
other person, student status, employment, or any combination of those
factors.</span></span><span style="font-family: Times, serif;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 5.65pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i>Medical Benefits For Children Under
27</i></b></span><b><i><span style="font-family: 'Times','serif';"><o:p></o:p></span></i></b></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The PPACA
amended </span></span><span style="font-family: 'Times','serif';"><span style="font-size: 12pt;"><a href="http://prod.resource.cch.com/resource/scion/citation/pit/S105%28b%29/STB-IRC?cfu=TAA"><span style="color: blue;">Code Sec. 105(b)</span></a></span><span style="font-size: 12pt;"> to extend the exclusion from gross income for medical
care reimbursements under an employer-provided accident or health plan to any
employee's child who has not attained age 27 as of the end of the tax year. The
amendment was effective March 30, 2010.</span><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 4.25pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The IRS issued
guidance in Notice 2010-38, which explains that the exclusion applies for
reimbursements for health care of individuals who are not age 27 or older at any
time during the tax year. The tax year is the employee's tax year (generally a
calendar year). The IRS also explained that a child for purposes of the extended
exclusion is an individual who is the son, daughter, stepson, or stepdaughter of
the employee. A child includes an adopted individual and an eligible foster
child.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 34pt 0pt;">
<span style="font-size: 12pt;"><b><span style="font-family: Times, serif;">IMPACT.</span></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 34pt 0pt;">
<span style="font-size: 12pt;"><i><span style="font-family: Times, serif;">There is no
requirement that a child generally qualify as a dependent for tax purposes.
There is also no requirement that an employer provide this coverage (as opposed
to dependent coverage under age 26, described above).</span></i></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Student
Loan Repayment Programs</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The PPACA
provides for exclusion of assistance provided to participants in state student
loan repayment programs for health professionals. The assistance is intended to
increase the availability of health care in areas traditionally underserved by
health professionals. </span></span><span style="font-family: Times, serif;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><span style="font-family: Times, serif;">BUSINESS TAX
PROVISIONS</span></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Shared
Responsibility For Employers</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The PPACA's
employer shared responsibility provisions (also <span style="background-color: yellow;">known as the "employer mandate")</span> specify
that an applicable large employer may be subject to a shared responsibility
payment (also known as an "assessable payment") if any full-time employee is
certified to receive an applicable premium tax credit or cost-sharing reduction
payment. Generally, this may occur where either:</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 0in 0in 0pt 42.5pt; text-indent: -42.5pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;"> </span><span style="font-family: 'Times New Roman', serif;">-</span><span style="font-family: Times, serif;"> The employer does not offer to its fulltime
employees (and their dependents) the opportunity to enroll in minimum essential
coverage under an eligible employer-sponsored plan; or</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 0in 0in 0pt 42.5pt; text-indent: -42.5pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;"> - The employer offers its
full-time employees (and their dependents) the opportunity to enroll in minimum
essential coverage under an eligible employer-sponsored plan that either is
unaffordable relative to an employee's household income or does not provide
minimum value (that pays at least 60 percent of benefits).</span></span><span style="font-family: 'Times','serif'; font-size: 12pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 5.65pt 34pt 0pt;">
<span style="font-size: 12pt;"><b><span style="font-family: Times, serif;"> COMMENT</span></b></span><span style="font-family: 'Times','serif'; font-size: 12pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 5.65pt 34pt 0pt;">
<span style="font-size: 12pt;"><i><span style="font-family: Times, serif;">The provision
applies to months beginning after December 31, 2013.</span></i></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 5.65pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">For purposes of
the employer shared responsibility payment, <span style="background-color: yellow;">an applicable large employer is an employer
that on average employed 50 or more full-time</span> equivalent employees on
business days during the preceding calendar year. A full-time employee is an
employee who is employed on average at least 30 hours per
week.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div align="center" class="MsoNormal" style="margin: 8.5pt 0in 0pt; text-align: center;">
<span style="font-size: 12pt;"><b><span style="font-family: Times, serif;">EXCHANGES</span></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The PPACA
requires each state to establish an American Health Benefit Exchange and Small
Business Health Options Program (SHOP Exchange) to provide qualified individuals
and qualified small business employers access to health plans. Exchanges will
have four levels of coverage: bronze, silver, gold, or platinum. In early 2012,
HHS reported that 34 states and the District of Columbia have received grants to
fund their progress toward building Exchanges. HHS also provided an Exchange
blueprint that states may use. If a state decides not to operate an Exchange for
its residents, HHS will operate a federally-facilitated Exchange
(FFE).</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Small
Employer Health Insurance Tax Credit</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The PPACA
created the temporary </span></span><span style="font-family: 'Times','serif';"><span style="font-size: 12pt;"><a href="http://prod.resource.cch.com/resource/scion/citation/pit/S45R/STB-IRC?cfu=TAA"><span style="color: blue;">Code Sec. 45R</span></a></span><span style="font-size: 12pt;"> small employer health insurance tax credit. For tax
years 2010 through 2013, the maximum credit is 35 percent of health insurance
premiums paid by small business employers (25 percent for small taxexempt
employers). <span style="background-color: yellow;">The credit is scheduled to
increase to 50 percent</span> for small business employers (35 percent for small
tax-exempt employers) after 2013 (<span style="background-color: yellow;">but
will terminate after 2015</span>). However, in tax years that begin after 2013,
an employer must participate in an insurance exchange in order to claim the
credit, and other modifications and restrictions on the credit
apply.</span><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 4.25pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">In Notice
2010-44, the IRS provided guidance on the small employer health insurance tax
credit, including transition relief for tax years beginning in 2010 with respect
to the requirements for a qualifying arrangement. The IRS expanded on the
guidance in Notice 2010-82. The IRS explained in Notice 2010-82 that a qualified
employer must have:</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 0in 0in 0pt 42.5pt; text-indent: -42.5pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;"> </span><span style="font-family: 'Times New Roman', serif;">-</span><span style="font-family: Times, serif;"> Fewer than 25 full-time equivalent employees
(FTEs) for the tax year;</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 0in 0in 0pt 42.5pt; text-indent: -42.5pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;"> </span><span style="font-family: 'Times New Roman', serif;">-</span><span style="font-family: Times, serif;"> Average annual wages of its employees for the
year of less than $50,000 per FTE; and</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 0in 0in 0pt 42.5pt; text-indent: -42.5pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;"> </span><span style="font-family: 'Times New Roman', serif;">-</span><span style="font-family: Times, serif;"> A "qualifying arrangement" that is
maintained.</span></span></div>
<div class="MsoNoSpacing">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Exchange-Participating Qualified Health Plans
Offered Through Cafeteria Plans</span></i></b></span><o:p></o:p></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">For tax years
beginning after December 31, 2013, a cafeteria plan cannot offer a qualified
health plan offered through an American Health Benefit
Exchange.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Health
FSAs Offered In Cafeteria Plans</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">Effective for
tax years beginning after December 31, 2012, the PPACA <span style="background-color: yellow;">limits contributions</span> to health flexible
spending arrangements (health FSAs) <span style="background-color: yellow;">to
$2,500, down from an overall $5,000 FSA limit</span>. The $2,500 limitation is
adjusted annually for inflation for tax years beginning after December 31,
2013.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Over-the-Counter
Medicines</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The PPACA <span style="background-color: yellow;">revises the definition of medical
expenses</span> for health flexible spending arrangements (health FSAs), health
reimbursement arrangements (HRAs), health savings accounts (HSAs) and Archer
Medical Savings Accounts (Archer MSAs). After December 31, 2010, <span style="background-color: yellow;">expenses incurred for a medicine or drug are
treated as a reimbursement for a medical expense only if the medicine or drug is
a prescribed drug or insulin</span></span></span><span style="font-family: Times, serif;"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Retiree
Prescription Drug Subsidy</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The Medicare
Prescription Drug, Improvement, and Modernization Act of 2003 provides a subsidy
of 28 percent of covered prescription drug costs to employers that sponsor group
health plans with drug benefits to retirees. PPACA requires the amount otherwise
allowable as a business deduction for retiree prescription drug costs to be
reduced by the amount of the excludable subsidy-payments received, effective for
tax years beginning after December 31, 2012.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Limitation
on Employee Remuneration</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The PPACA limits
the allowable deduction to $500,000 for applicable individual remuneration and
deferred deduction remuneration attributable to services performed by applicable
individuals that is otherwise deductible by a covered health insurance provider
in taxable years beginning after December 31, 2012.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 4.25pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">In Notice
2011-2, the IRS explained that the provision may affect deferred compensation
attributable to services performed in a tax year beginning after December 31,
2009. The IRS also provided a de minimis rule.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Medical
Device Excise Tax</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The PPACA <span style="background-color: yellow;">imposes an excise tax on the sale of certain
medical devices</span> by the manufacturer, producer, or importer of the device
in an amount equal to <span style="background-color: yellow;">2.3 percent of the
sale price</span>. The excise tax applies to sales of taxable medical devices
after December 31, 2012.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 4.25pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Retail
exemption.</span></i></b><span style="font-family: Times, serif;"> The PPACA
<span style="background-color: yellow;">exempts certain devices from the excise
tax, such as eyeglasses, contact lenses and hearing aids</span>. In the proposed
regulations, the IRS provided a facts and circumstances approach to evaluating
whether a taxable medical device is of a type that is generally purchased by the
general public at retail for individual use. A device is considered to be of a
type generally purchased by the general public at retail for individual use if
(i) the device is regularly available for purchase and use by individual
consumers who are not medical professionals, and (ii) the device's design
demonstrates that it is not primarily intended for use in a medical institution
or office, or by medical professionals.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Credit For
Therapeutic Discovery Projects</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">Eligible
taxpayers may qualify for a 50-percent tax credit for investments in therapeutic
discovery projects. The PPACA also established the qualifying therapeutic
discovery project program to consider and award certifications for qualified
investments eligible for the credit. The credit was available for qualified
investments made or to be made in 2009 and 2010. Additionally, the PPACA
provides for grants in lieu of tax credits for investments in therapeutic
discovery projects.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><span style="font-family: Times, serif;">REPORTING</span></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Forms
W-2</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The PPACA
generally requires employers to disclose the aggregate cost of applicable
employer-sponsored coverage on an employee's Form W-2 for tax years beginning on
or after January 1, 2011. Reporting is for informational purposes
only.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 4.25pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">In Notice
2010-69, the IRS made reporting optional for all employers for 2011. In Notice
2012-9, the IRS provided transition relief for small employers. For 2012 Forms
W-2 (and W-2s issued in later years, unless and until further guidance is
issued), an employer is not subject to reporting for any calendar year if the
employer was required to file fewer than 250 Forms W-2 for the preceding
calendar year, the IRS explained. </span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Health
Care Coverage Reporting</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The PPACA
requires every health insurance issuer, sponsor of a self-insured health plan,
government agency that administers government-sponsored health insurance
programs and other entity that provides minimum essential coverage to file an
annual return reporting information for each individual for whom minimum
essential coverage is provided (</span></span><span style="font-family: 'Times','serif';"><span style="font-size: 12pt;"><a href="http://prod.resource.cch.com/resource/scion/citation/pit/S6055/STB-IRC?cfu=TAA"><span style="color: blue;">Code Sec. 6055</span></a></span><span style="font-size: 12pt;"> reporting). Additionally, every applicable large
employer (within the meaning of </span><span style="font-size: 12pt;"><a href="http://prod.resource.cch.com/resource/scion/citation/pit/S4980H%28c%29%282%29/STB-IRC?cfu=TAA"><span style="color: blue;">Code Sec. 4980H(c)(2)</span></a></span><span style="font-size: 12pt;">) that is required to meet the shared employer
responsibility requirements of the PPACA during a calendar year must file a
return with the IRS reporting the terms and conditions of the health care
coverage provided to the employer's full-time employees for the year
(</span><span style="font-size: 12pt;"><a href="http://prod.resource.cch.com/resource/scion/citation/pit/S6056/STB-IRC?cfu=TAA"><span style="color: blue;">Code Sec. 6056</span></a></span><span style="font-size: 12pt;"> reporting). The reporting requirements apply to
calendar years beginning on or after January 1,
2014.</span><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Disclosures</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">Because the
PPACA is being implemented by multiple federal agencies, the statute authorizes
the IRS to disclose return information to HHS and other agencies. Return
information is scheduled to be disclosed for, among other purposes, eligibility
for the </span></span><span style="font-family: 'Times','serif';"><span style="font-size: 12pt;"><a href="http://prod.resource.cch.com/resource/scion/citation/pit/S36B/STB-IRC?cfu=TAA"><span style="color: blue;">Code Sec. 36B</span></a></span><span style="font-size: 12pt;"> premium assistance tax
credit.</span><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 4.25pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">In NPRM
REG-119632-11, the IRS explained that it will disclose taxpayer identity
information, filing status, the number of individuals for which a deduction
under </span></span><span style="font-family: 'Times','serif';"><span style="font-size: 12pt;"><a href="http://prod.resource.cch.com/resource/scion/citation/pit/S151/STB-IRC?cfu=TAA"><span style="color: blue;">Code Sec. 151</span></a></span><span style="font-size: 12pt;"> was allowed ("family size"), modified adjusted gross
income, and the tax year to which the information relates or, alternatively,
that the information is not available. Where modified adjusted gross income is
not available, the IRS will disclose adjusted gross
income.</span><o:p></o:p></span><span style="font-size: 12pt;"> </span><span style="font-size: 12pt;"> </span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Nonprofit
Health Insurance Issuers</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The PPACA
establishes the Consumer Operated and Oriented Plan (CO-OP) Program. The CO-OP
Program is intended to encourage the creation of qualified nonprofit health
insurance issuers to offer competitive health plans in the individual and small
group markets. The PPACA also enacted </span></span><span style="font-family: 'Times','serif';"><span style="font-size: 12pt;"><a href="http://prod.resource.cch.com/resource/scion/citation/pit/S501%28c%29%2829%29/STB-IRC?cfu=TAA"><span style="color: blue;">Code Sec. 501(c)(29)</span></a></span><span style="font-size: 12pt;"> to provide requirements for tax exemption under
</span><span style="font-size: 12pt;"><a href="http://prod.resource.cch.com/resource/scion/citation/pit/S501%28a%29/STB-IRC?cfu=TAA"><span style="color: blue;">Code Sec. 501(a)</span></a></span><span style="font-size: 12pt;"> for qualified nonprofit health insurance issuers
(QNHIIs).</span><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Tax-Exempt
Charitable Hospitals</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The PPACA
imposes additional requirements on </span></span><span style="font-family: 'Times','serif';"><span style="font-size: 12pt;"><a href="http://prod.resource.cch.com/resource/scion/citation/pit/S501%28c%29%283%29/STB-IRC?cfu=TAA"><span style="color: blue;">Code Sec. 501(c)(3)</span></a></span><span style="font-size: 12pt;"> charitable hospitals. Tax-exempt hospitals must conduct
a community health needs assessment (CHNA) and adopt a financial assistance
policy. The PPACA also places limitations on charges to individuals who qualify
for financial assistance and prohibits certain collection actions. Tax-exempt
hospitals must satisfy these additional requirements to maintain their exempt
status.</span><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><span style="font-family: Times, serif;">ADDITIONAL
PROVISIONS</span></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Grandfathered Plans</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">Certain plans or
coverage existing as of March 23, 2010 (the date of enactment of the PPACA) are
subject to only some provisions of the PPACA. These plans are known as
"grandfathered plans."</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 4.25pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The IRS, HHS and
DOL issued interim final regulations in 2010 and subsequently amended the
interim final regulations (TD 9506). The agencies explained that a group health
plan or group or individual health insurance coverage is a grandfathered health
plan with respect to individuals enrolled on March 23, 2010 regardless of
whether an individual later renews the coverage. Additionally, a group health
plan that provided coverage on March 23, 2010 generally is also a grandfathered
health plan with respect to new employees (whether newly hired or newly
enrolled) and their families that enroll in the grandfathered health plan after
March 23, 2010.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Patient's
Bill Of Rights</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The PPACA
generally provides that a group health plan and a health insurance issuer
offering group or individual health insurance coverage <span style="background-color: yellow;">may not impose any preexisting condition
exclusion</span>. The PPACA also <span style="background-color: yellow;">prohibits</span> group health plans and health
insurance issuers offering group or individual health insurance coverage from
<span style="background-color: yellow;">imposing lifetime or annual limits on the
dollar value of health benefits</span>. Additionally, a group health plan, or a
health insurance issuer offering group or individual health insurance coverage,
must not rescind coverage except in the case of fraud or an intentional
misrepresentation of a material fact.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 5.65pt 34pt 0pt;">
<span style="font-size: 12pt;"><b><span style="font-family: Times, serif;"> COMMENT</span></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 5.65pt 34pt 0pt;">
<span style="font-size: 12pt;"><i><span style="font-family: Times, serif;">A group
health plan or group health insurance coverage must comply with the prohibition
against preexisting condition exclusions; <span style="background-color: yellow;">however, a grandfathered health plan that is
individual health insurance coverage is not required to comply with the
prohibition</span>.</span></i></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 5.65pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The IRS, HHS and
DOL issued interim final regulations in 2010. The agencies explained that the
prohibition against preexisting condition exclusions generally is effective with
respect to plan years (in the individual market, policy years) beginning on or
after January 1, 2014. However, the prohibition became effective for enrollees
who are under 19 years of age for plan years (in the individual market, policy
years) beginning on or after September 23, 2010.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 4.25pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The agencies
also explained that the annual limits do not apply to health flexible spending
accounts (health FSAs), Archer medical savings accounts (Archer MSAs) and health
savings accounts (HSAs); and plans and issuers cannot rescind coverage unless an
individual was involved in fraud or made an intentional misrepresentation of
material fact.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><b><i><span style="font-family: Times, serif;">Business
Information Reporting</span></i></b></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<div class="MsoNormal" style="margin: 8.5pt 0in 0pt;">
<span style="font-size: 12pt;"><span style="font-family: Times, serif;">The PPACA
requires businesses, charities and government entities to file an information
return (Form 1099) when they would make annual purchases aggregating $600 or
more to a single vendor, other than to a vendor that is a tax-exempt
organization, for payments made after December 31, 2011 and reported in 2013 and
years thereafter. The PPACA also repealed the long-standing reporting exception
for payments made to corporations.</span></span><span style="font-family: 'Times','serif';"><o:p></o:p></span></div>
<span style="font-size: 12pt;"></span><br />
<div class="MsoNoSpacing">
<span style="background-color: yellow;"><br /></span></div>
<div class="MsoNoSpacing">
<span style="background-color: yellow;">The Comprehensive
1099 Taxpayer Protection and Repayment of Exchange Subsidy Overpayments Act of
2011 repealed the expansion of business information reporting under the PPACA as
if it had never been enacted.</span></div>
<span style="font-size: 12pt;"></span><br />
<br />
<div class="MsoNoSpacing">
<span style="font-size: 12pt;"><br /></span></div>
<div class="MsoNoSpacing">
<span style="font-size: 12pt;">Yours sincerely,</span></div>
<div class="MsoNoSpacing">
<span style="font-size: 12pt;"><b><br /></b></span></div>
<div class="MsoNoSpacing">
<span style="font-size: 12pt;"><b><a href="http://www.debreczeni-petrash.com/">www.debreczeni-petrash.com</a>Debreczeni & Petrash
CPAs</b></span></div>
<div class="MsoNoSpacing">
<o:p></o:p></div>
</td></tr>
<tr>
<td><!--- Facebook --->
<script>
</script>
<a href="http://www.facebook.com/share.php?u=http%3A%2F%2Fwww%2Edebreczeni%2Dpetrash%2Ecom%2F21%2Ehtm%23post166" target="_blank"><img alt="Share on Facebook" border="0" height="20" src="https://www.webbuildersolution.com/images/facebook.png" width="20" /></a> <!--- Twitter ---><a href="http://twitter.com/home?status=Currently%20reading%20http%3A%2F%2Fwww%2Edebreczeni%2Dpetrash%2Ecom%2F21%2Ehtm%23post166" target="_blank" title="Click to share this post on Twitter"><img alt="Share on Twitter" border="0" height="20" src="https://www.webbuildersolution.com/images/twitter.png" width="20" /></a> <!--- LinkedIn ---><a href="http://www.linkedin.com/shareArticle?mini=true&url=http://www.debreczeni-petrash.com/21.htm#post166&title=&source=http://www.debreczeni-petrash.com/21.htm#post166" target="_blank"><img alt="Share on LinkedIn" border="0" height="20" src="https://www.webbuildersolution.com/images/linkedin.png" width="20" /></a> <!--- Email ---><a href="mailto:?subject=&body=http%3A%2F%2Fwww%2Edebreczeni%2Dpetrash%2Ecom%2F21%2Ehtm%23post166"><img alt="Share in email" border="0" height="20" src="https://www.webbuildersolution.com/images/mail2.png" width="20" /></a></td></tr>
</tbody></table>Anonymoushttp://www.blogger.com/profile/17070654285843529386noreply@blogger.com0