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how it’s done →
Health Savings Accounts
Well, there isn’t much good to be said about the Medicare bill that Congress just passed, but the cloud does have this bit of silver lining for those of us rooting around for tax shelters:
New health savings accounts included in the Medicare legislation would let individuals save, invest and then spend money tax-free.
To avoid all taxes, the dollars must pay for medical expenses.…
Critics contend the accounts establish a tax shelter for the wealthy and set a precedent for future accounts to let affluent families evade taxes.…
The accounts, expected to bring in $6.4 billion less to the Treasury over , would be available to individuals with high-deductible health insurance.
The deductible must be at least $1,000 for an individual or $2,000 for a family.
Individuals, their employers or their family members could put away the amount of the annual deductible, up to $2,600 a year for individuals and $5,150 a year for families.
People age 55 to 65 could make additional contributions to build a medical nest egg.
Money deposited in the accounts could be invested, then withdrawn free of taxes for insurance premiums, prescription drugs, long-term care services, Medicare premiums and other health costs.
Employers would not pay payroll taxes on amounts they contribute as an employee benefits.
An account stays with a person for a lifetime. Upon death, assets can be transferred tax-free to a spouse.
USA Today describes the new tax-free medical savings accounts that are part of the Medicare bill that Bush will be signing in a few days.
(“Health savings can be tax shelter”).
According to the article, the new law allows people to sign up for these accounts starting — if they can find a company that’s ready to administer the plans.
To qualify for the plans, you have to have a “high-deductible” medical insurance policy (“As defined in the new Medicare legislation… a high-deductible policy is $1,000 for individual coverage, $2,000 for a family.”)
The accounts will join about a half dozen other major provisions in the federal law that provide a tax advantage for health care spending.
But nothing now in the law combines the broad eligibility and generous tax benefits of HSAs.
“This is far and above superior to all the other ones that are out there,” says Jay Nawrocki, legislative analyst at tax publisher CCH.
Contributions, investment growth and withdrawals for health-related expenses are all free from taxation.
That makes tax benefits superior even to IRAs.
With IRAs, the money is taxed either before it goes into the investment account, or as it is taken out.
Of course, money from an IRA, when taken after age 59½, can be spent without restriction.
Health savings accounts carry generous annual contribution limits.
The law allows an annual tax write-off equal to the deductible amount of the accompanying health care plan.
But the tax write-off can’t exceed $2,250 for an individual plan, $4,500 for a family plan.
Limits bump higher in years ahead.
’s New York Times has some more information about the new health savings accounts and how they’re going to be administered (“Insurers Ready to Sell Medical Savings Accounts”) — although I’m still searching for a California company that offers them.
Today’s grab-bag:
Conversations with the IRS — what happened when a war tax resister who hadn’t filed in years finally got called on the carpet by an IRS agent.
A follow-up on Health Savings Accounts answers two questions about the new tax-sheltered savings plans:
1) Are you obligated to withdraw from the accounts to pay your health expenses, or can you keep the sheltered money there as an additional IRA-like investment?
2) What happens to your Health Savings Account when you die?
The Treasury Inspector General for Tax Administration has issued a scathing report on the failures of IRS enforcement efforts:
[O]f 172 tax convictions studied, more than $2.5 million in back taxes, interest and penalties went unpaid by people who ignored the terms of their sentences.
For example, the IRS’s criminal investigations division closed 37 cases with probationary periods ending .
Of those 37, only six complied with their sentences, which included payment of back taxes, penalties and interest, the report said.
In 11 cases, the convicted tax evaders were not at fault, since the IRS failed to inform them of the terms of their penalties.
In 12 cases of known noncompliance, the IRS’s criminal investigators did not bother to notify the criminals’ probation officers or the criminal courts.
“To say that it looks like the IRS is dropping the ball in these cases would be an understatement,” Sen. Max Baucus of Montana, the ranking Democrat on the Senate Finance Committee, said in a statement.
“We’ve caught the criminal, prosecuted the crime and handed out the sentence.
Seeing that the sentence is enforced should be the easiest part of the whole process.”
“The old saying is, ‘If you can’t do the time, don’t do the crime.’
Now it seems you don’t have to do the time or even pay a dime,” Sen. Charles E. Grassley (R-Iowa), the committee’s chairman, said in a statement.
Here’s a great idea for a revenue booster:
Let’s say you’re a government that’s wrongfully convicted somebody and therefore imprisoned an innocent person for years.
Why should you have to pay for that person’s food and lodging all those years when that prisoner had no legal right to such good treatment?
(I’m reminded of the government of China charging condemned victims’ families for the bullets used to execute them):
Agency initiates steps for selective draft — “The government is taking the first steps toward a targeted military draft of Americans with special skills in computers and foreign languages”
The “Health Savings Accounts” from ’s Medicare bill were scraped together and turned into law so quickly that the federal bureaucracy and the insurance industry are still trying to figure out what it all means.
For legal tax resisters and run-of-the-mill tax avoiders these HSAs are a new way to legally squirrel away some of our hard-earned money and keep it out of the hands of the tax collector.
But the details are still being worked out.
, Treasury Secretary John Snow released some new interpretations of the rules regarding HSAs.
Part of the motivation for these new plans is to encourage people to move over to high-deductible health insurance.
If you have a $2,000 deductible, which is considered a “high-deductible,” the first $2,000 or so of your health costs come out of your pocket, and the insurance company only starts paying after you reach that deductible.
The reasoning behind encouraging plans like this is that if people have to use their own money to pay for the minor cuts-and-scrapes and ointments & pills that most people encounter during a year, they’ll be less likely to run to the doctor for every little thing, and when they do go to the doctor there won’t always be insurance paperwork involved.
This, in theory, should lower health costs and health insurance costs.
An analogy I’ve frequently seen is with auto insurance.
If your auto insurance covered everything — from oil changes to tire replacement — then the amount of paperwork, fraud, and annoyance would go way up.
People who sell tires and oil would charge higher prices because people would be less likely to bargain shop.
But auto insurance doesn’t cover the small stuff, but only high-ticket items like crashes.
The theory goes that if health insurance uses this model, eventually health-care costs will drop.
To encourage this, the HSAs are offered only to people who have a high-deductible health insurance and nothing else.
But what about preventive health care?
Things like regular check-ups, immunizations, and prenatal care?
Insurers have often covered such things more generously, thinking that money they spend to encourage their customers to get preventive care will be money they save when the preventive care prevents future medical problems. Can they continue to pay for preventive care under high-deductible plans, or must they force the patient to pay for these things up to the deductible?
They’re still considering things like “certain drug costs benefits provided by employee assistance programs, mental health programs, or wellness programs.”
The IRS has released some more thorough guidelines as to how to establish, offer and use Health Savings Accounts.
HSAs are a new, legal way for people to hide a portion of their income from the tax man.
I’ve been trying to keep Picket Line readers up-to-date as the IRS continues to try to decide what Congress had in mind when they enacted them.
Previous Picket Line entries about HSAs, with more details about what they are and why they’re useful, include:
One interesting part of the update:
“HSA owners can carry over expenses from year to year for later tax-free reimbursement.
For example, a 40-year old taxpayer starts an HSA in August 2004.
Each year he incurs $2000 in out-of-pocket health costs, so over 25 years he has incurred $50,000 in unreimbursed medical expenses.
If he hasn’t withdrawn any funds from his HSA for 25 years, he can withdraw up to $50,000 tax-free.
The catch: he has to be able to document those old expenses.”
It’s another way in which these new plans are much more flexible and liquid than IRAs (which they otherwise resemble).
Regular readers of The Picket Line know that I’ve been recommending the new Health Savings Accounts as a way to shelter additional money from the IRS.
Today over at Benefitsblog, B. Janell Grenier notes that the road to HSA paradise has been a bumpy one (and gives me a possible clue as to why this Californian has had such a hard time signing up for an HSA plan).
The pamphlet HSA Road Rules (PDF) does a thorough job of explaining these new tax-advantaged health savings accounts from the perspective of the insured, the insurer, the account administrator, and the employer.
These accounts are potentially very useful to people who are resisting taxes by keeping their incomes low.
Health Savings Accounts, as I’ve mentioned before (see , , , , , , and ), are a great way for the low-income tax resister to shield a little more hard-earned money from the IRS.
Republicans met “Cover the Uninsured Week” on by pushing several stalled enhancements for health savings accounts (HSAs) and introducing a new but potentially expensive tax credit for health insurance.
Rep. John B. Shadegg, R-Ariz., introduced the Patients’ Health Care Reform Act, which would allow all Americans a refundable tax credit for purchasing health insurance.
“Refundable” tax credits are ones like the Earned Income Tax Credit, in which you can get a credit that exceeds the tax you owe, so that the government ends up owing you money at the end of the year (most other tax credits only allow you a maximum credit equal to the tax you owe).
Rep. Eric Cantor, R-Va., asked Congress to move H.R. 1872, which would allow HSA holders to take an above-the-line deduction for the cost of their insurance premiums.
That’d be nice.
I had been under the impression that you could pay your insurance premiums from your HSA deposits, which turns out not to be the case.
For me, this isn’t so much of an issue:
I get to deduct my health insurance premiums anyway because I’m self-employed. But for other folks who use HSAs, this change would certainly help.
If you signed up for a Flexible Savings Account to pay for your medical expenses with untaxed wages, you may be coming up on feeling like you’ve been a little too healthy for your own good — if you didn’t spend all of the money that you put in your FSA account this year, it will soon vanish.
Kay Bell of Don’t Mess With Taxes has some advice for people with an end-of-year FSA account surplus, including no-brainers like getting your teeth cleaned or signing up for a routine annual physical, to good ideas like getting a back-up pair of eyeglasses or a cache of batteries for your hearing aid, filling up the medicine cabinet with a year’s supply of whatever you turn to in times of flu or bad leftovers, or picking up a Hurricane Katrina-sized emergency first aid kit.
And I would add that you might want to consider switching from an FSA to a Health Savings Account.
An HSA doesn’t have the spend-it-or-lose-it feature that makes FSA accounts so annoying.
, I highlighted some of the tax resistance tidbits that stacked up in my inbox while I was away in México.
, some tax policy and budget news of possible interest to those of us doing tax resistance.
The biggest item of news was Dubya’s state-of-the-union push for expanded Health Savings Accounts.
He made it enough of a priority that his partisans in Congress will probably work to try to make it happen, and, unlike his grandiose and botched Social Security plan, it’s a small enough nibble of a program that they might just be able to patch something together and put it on his desk.
Health Savings Accounts (HSAs).
These are IRA-like accounts that must be used in conjunction with high-deductible health insurance.
The proposals:
Double break for non-group high-deductible premiums.
Individuals buying their own high-deductible health insurance — i.e., individuals with no employer plan — would be allowed a full above-the-line deduction for the premiums and a 15.3% refundable credit on the premiums paid.
The credit is designed to give the individual insurance purchaser the same tax benefit as an employee with coverage through the employer.
Increase maximum HSA deduction to policy out-of-pocket maximum.
Current law limits HSA contributions to the lesser of the maximum out-of-pocket costs under the plan or $5,450 ($2,650 for single coverage).
The budget proposes to eliminate the dollar limits.
Refundable health premium tax credit for low-income individuals.
A limited tax credit of up to 90% of premiums paid on high-deductible health policies would be available to single taxpayers with an AGI of up to $15,000. The credit would be 50% for taxpayers with up to $20,000 AGI, with the benefit phased out between $20,000 and $30,000. The credit would be refundable, which means it would operate as a subsidy.
The credit is capped at $1,000 annually.
These items are designed to put individuals without employer coverage on the same tax footing as employees in terms of health care tax benefits.
They are also designed to address criticisms that the HSA program is only good for wealthy taxpayers.
All other things being equal, this plan would be very good news for those of us tax resisters practicing The DON Method.
At the last minute, Congress has approved a bill that extends certain tax provisions and makes other tax law modifications.
Dubya is expected to sign it into law.
Among the parts of this bill that will be of interest to Picket Line readers are the following:
Tax Deductions
The above-the-line deduction for higher education expenses such as tuition and fees was extended through , with the same $4,000 maximum deduction.
The itemized deduction for state & local sales taxes was also extended through .
The above-the-line deduction for the out-of-pocket expenses of teachers for classroom supplies ($250 maximum) was extended through .
Since the IRS had already sent its tax forms to the printers before this bill was passed, the 1040 forms don’t have lines for things like the tuition/fees deduction or the deduction for teachers’ classroom expenses (which, until this bill passed, were not valid deductions for the tax year).
I don’t know yet how you are expected to apply for these deductions.
HSA Changes
The ceiling for yearly HSA deposits used to be equal to your health insurance deductible.
Now it’s the same ceiling for everybody, no matter what their deductible is (so long as it’s high enough to qualify).
You can now, under some circumstances anyway, transfer money from your FSA or HRA to your HSA.
You can also, once in your life, transfer money from an IRA to your HSA.
You can make your yearly deposit this way, and can transfer no more than you are allowed to deposit normally.
If you don’t need the extra deduction that you get from depositing money that would otherwise be taxable income, this might be a good idea, since HSAs have all the advantages of IRAs with more flexibility over how and when you can spend the money in them.
I’m not sure as to the logic behind this provision, whom it is meant to benefit, and why it is limited to once-in-a-lifetime.
I’ve since learned the logic behind this, or a plausible story at any rate: This is to help employees whose employers are switching their health benefits from a low-deductible plan to a high-deductible plan with a health savings account.
For those employees who are worried that in case of some sudden health expense they won’t have enough money to meet the deductible, and they also don’t have enough money lying aroung to pre-fund their HSA, they can instead fund their HSA by transferring money from their IRA.
This way they don’t get caught without the ability to pay their medical bills during the switch-over.
Additional Changes
The frivolous filing penalty has been upped from $500 to $5000 and now applies to all federal taxes not just federal income tax.
It also may now apply to things other than tax returns, such as “requests for a collection due process hearing, installment agreements, and offers-in-compromise.”
The IRS is required to publish a list of what it considers to be frivolous arguments before applying these fines (this isn’t new).
This might affect those tax resisters who include marginal notes of protest with their tax forms, declare vast number of “dependents”, or try to use the tax courts to advance legal arguments about the Nuremberg Principles and other such long shots.
It will certainly snag the folks in the Constitutionalist tax protester set, for whom these provisions were targeted.
When I wrote up this summary, I was working with a description of the bill as it was written on , before it passed.
There’s a possibility that some of this changed before the bills made it through, so keep an eye on the news for verification.
Maybe I’m jumping the gun on this, as there’s still a little bit of Congressional back-and-forth due before Obama can put his name on the dotted line, but here’s what I’ve been able to discern about the impact of the recent health care industry legislation on tax resisters like you and me:
The plan gives a lot of enforcement responsibility to the Internal Revenue Service without actually budgeting the agency any more money or personnel.
Looking into the crystal ball, I see that there’ll be some effort in the future to beef up the agency so that it can better handle these new responsibilities.
Peering closer, I think I discern that the agency won’t get nearly enough to cover the expenses of the new mandates, and so agency service, and its ability to go after tax delinquents, will probably further decline.
The bill encourages the founding of new non-profit health insurance issuers.
These issuers will be exempt from federal income tax.
Such tax-exempt, non-profit health insurers exist today, but are fairly rare.
A good analogy here is the credit union: as credit unions are to banks, these new non-profit health insurance issuers will be to ordinary health insurance companies.
They will take the form of member-run cooperatives.
(This starts now.)
A new health coverage tax credit is part of the bill.
This is a refundable credit for 80% of the cost of health insurance coverage, but it is only available to a small subset of taxpayers (“individuals who receive a trade adjustment allowance (and individuals who would be eligible to receive such an allowance but for the fact that they have not exhausted their regular unemployment benefits), individuals eligible for the alternative trade adjustment assistance program, and individuals over age 55 who receive pension benefits from the Pension Benefit Guaranty Corporation” who are not covered by Medicare or employer-subsidized plans).
(This starts in .)
There is also a new “premium assistance credit” — also a refundable tax credit — for people who get their health insurance via an exchange (the “exchange” model is also created by this legislation).
This credit, oddly, goes straight from the government to the insurer as a way of subsidizing your purchase of health insurance.
The amount the insurance company will get is based on your tax return from two years back, but the actual credit you qualify for will be based on your financial circumstances in the year you get the credit, so you’ll have to rectify this one way or the other on your tax return.
The credit amount is based on your income, and is only available to households whose cumulative modified adjusted gross income puts them between 100% and 400% of the poverty line for their household type.
(This all starts in .)
There is also a new subsidy for households in the 100–400% of the poverty line range who purchase high-deductible health plans.
These are the sorts of plans that qualify for Health Savings Accounts, but I’m not entirely sure of all of the ways the new law affects the old Health Savings Accounts scheme.
Assuming such accounts are still a good tax shelter, the new law may make them more attractive to people with low-incomes who might otherwise have been frightened off by the high deductible.
(This starts now.)
Beginning in , all Americans will be required to carry some minimum amount of health insurance.
The way this will be enforced is through the tax code: there will be a federal excise tax on non-insured people, payable by those people.
As with the social security system, the Amish managed to finagle themselves a conscientious objection provision.
This tax will be 2.5% of income above the standard-deduction/personal-exemption filing threshold, or a fixed amount: $95 per uninsured person in , $325 per in , $695 per in , and then indexed for inflation thereafter (whichever is higher).
If the cheapest health insurance you can find still costs more than 8% of your household income, you’re off the hook for this excise tax; you are also off the hook if you make so little income that you aren’t required to file an income tax return, if your lapse of required coverage was less than three months long, or if you are a resident of a United States possession (e.g. Guam).
I’m not the first to notice that for many people the cost of this excise tax will be far less than the cost of the insurance.
Weirdly, although this excise tax will be figured on your income tax return and will be part of your total tax burden for the year, the law specifically forbids the IRS from using its ordinary tools of liens, seizures, criminal & civil penalties, or interest in pursuit of unpaid amounts.
This will probably confuse the hell out of them and make a lot of work for their CoBOL team.
Also, it makes tax refusal a profitable no-brainer, as without penalties and interest, the unpaid amount will be eroded by inflation from year to year.
Starting in , health insurers will have to submit information to the IRS about all the people who have health insurance coverage with them, including contact information, the taxpayer identification (usually social security) number, details on the coverage, and “such other information as the Secretary may require.”
This could be a snag for non-filers who are trying to stay off of the IRS radar.
There is a new tax attached to most health insurance plans.
It starts at $2 per covered person in , and then rises each year based on the rise in the cost of health expenses.
There is also a new tax on health insurance companies, starting in .
You won’t pay these taxes directly, but indirectly via the cost of your health insurance.
The same sorts of insurers that are exempt from federal income tax will also get a reduction, though not an exemption, in the tax they pay here.
So-called “cadillac” high-end health insurance and reimbursement plans are heavily taxed to the extent that their benefits exceed a threshold that is calculated according to a formula that caused my eyes to glaze over and made me want to do anything besides think about it.
This won’t kick in until , by which time some subsequent Congress will probably have mucked with it, so it’s not worth paying much attention to anyway.
If you’ve gotten used to being able to pay for over-the-counter drugs with your Health Savings Account, Health Reimbursement Account, or Health Flexible Savings Account (“cafeteria plan”), you’ll be disappointed to find that, starting next year, you can only purchase prescription drugs (or insulin) this way.
Furthermore, the penalty for taking withdrawals from your Health Savings Account for non-authorized purposes has been increased to 20% of the amount.
There’s a new tax on drug manufacturers and importers, with the proceeds designated for the Medicare trust fund.
This starts in .
There is also a tax on medical devices (though not things like eyeglasses and hearing aids that are generally purchased by ordinary schmoes like you and me).
If you are unfortunate enough to have medical expenses that exceed 7.5% of your adjusted gross income in any particular year, you have been able to take any amount over 7.5% as an itemized deduction.
Starting in , you’ll have to be even more unfortunate, as this threshold will increase to 10%, with some exceptions.
There’s a new 10% tax on the price of indoor tanning services, starting in the second half of this year.
Self-employed people have been able to take an above-the-line deduction for the cost of health insurance for themselves and their dependents.
Under the new law, a dependent can include a child as old as 26 (before, the child had to be under 19, or under 24 and a full-time student).
Those of you lucky enough to be living off of your investments rather than from earned income have been exempt from paying social security and medicare taxes on your income.
No longer.
As of , you have to pay a 3.8% medicare tax on such unearned income to the extent that you rake it in above a certain threshold amount.
There is something called the “economic substance doctrine” that says that if a business engages in some complex economic transaction whose only effect is to lower the amount of taxes due by qualifying for the literal provisions of the tax code, without there being any other good reason for doing the transaction, then the business shouldn’t be able to take advantage of those tax benefits.
This doctrine, though, is more a matter of custom than of law, and plenty of folks think that the letter of the law, and not its less-discernible spirit, ought to apply.
This new bill tries to codify this doctrine and make it explicit and more uniformly-enforceable.
I expect that this will make a lot of lawyers very busy.
Since Congress deliberately uses the tax code as a prod to try to influence people and businesses to make certain decisions that they would otherwise not make for ordinary economic reasons (indeed this very bill is full of such provisions), this is weirdly schizophrenic.
Metaphorically, the Obamacare page is still loading and its icon looks like it’ll be spinning for a while yet, but I’m ready to share a very preliminary evaluation at how it interacts with my low-income tax resistance method.
In summary: the news so far is good.
It looks like I will be able to have a high-deductible health insurance plan that allows me to continue to contribute to a tax-advantaged Health Savings Account.
My strategy of keeping my adjusted gross income (AGI) below a certain threshold in order to avoid income tax has the side-effect of qualifying me for the maximum subsidy: I will be paying next-to-nothing (a token dollar per month) for this insurance.
Here are some observations and questions I’ve come up with along the way.
The law is complex and confusing and they’re still tweaking it, so don’t take any of this as gospel:
As a self-employed person, I’ve been permitted to take the cost of my health insurance premium as an “above-the-line” deduction on my 1040 (that is, a deduction that has the effect of lowering my AGI).
Because of this, although my premium is going from $2,500+ in 2013 to $12 in 2014, this won’t translate to any extra spending money for me as it wasn’t money I was spending out of my post-tax income anyway.
However, I’ll need to bring in $2,500 less income next year to meet my over-all expenses.
In other words, I’ll be able to maintain the same standard of living while having to work for $2,500 less income.
The way the insurance premium subsidy works is a sort of Rube Goldberg machine centered on the federal income tax, and it goes a little something like this:
The health insurance premium subsidy is implemented as a tax credit that is based on the premium amount and on your AGI.
If your AGI is low enough, some or most of your premium is paid by the government (or, if it’s even lower, you may be shuffled into Medicare).
Instead of making you pay for your insurance throughout the year and then giving you a big credit when you file your taxes the following year, the government parcels this credit out to you indirectly — by paying it to your insurance company in lieu of that portion of your own payment.
But you don’t know what your AGI is going to be for 2014 until you fill out your taxes in 2015, so you have to play a guessing game.
When you do file and learn what your real AGI was, you also find out what your credit should have been for the year.
If the government oversubsidized you, you’re supposed to pay it back; if you paid more than you had to, the government should issue you a refund.
But there are a number of restrictions on the government’s ability to collect any overpaid subsidies: the amount that the government can demand that you return has an absolute cap on it, and the IRS is prohibited by the law from using almost all of its usual measures for recovering tax debts to go after this specific sort of delinquency.
Since all the tax amounts are going to be mixed up on the 1040 and come out as one number at the end, I expect that the agency is going to have a hell of a time figuring out how to take enforcement actions against people whose tax debts are mixtures of overcredited Obamacare premiums and resisted income taxes.
(Hint, hint.)
I think I may have had this last point wrong.
I have heard since that the absolute caps are only for people at low income levels: so that if you qualify for a subsidy, but the subsidy you actually received was higher than what you qualify for, you might not have to repay the complete difference between the two amounts; however, if you don’t qualify for a subsidy but you got one anyway, you can be required to pay back the full amount.
Also: I think the restrictions on the IRS’s ability to use its enforcement measures against you may be restricted to its efforts to retrieve the amount of the tax penalty for not having health insurance at all, and that it may use all of its usual measures to try to recover over-paid subsidies.
Again, the details of the law remain fuzzy to me, and I read a lot of contradictory things about it, so I’m piecing it together.
So wait a minute: The government is going to keep paying to subsidize my health insurance at the same time that they’re trying to chase me down for (last I counted) $26,000+ I’ve refused to pay them?
Seriously?
Apparently so.
I have heard of no mechanism for withholding subsidies from people with tax debts.
Perhaps if I foolishly applied for the subsidies as a tax credit on my 1040 instead of applying for the government to use the subsidy to cover my monthly premium, the IRS would seize the refund and apply it to what they’re trying to extract from me, but they don’t seem to have any interest in interrupting the payments if I apply in the normal way.
I anticipate at some future date, despicable leeches like myself will be subject to some sort of two-minute hate and Congress will cut us off in a flurry of righteous hearings and outraged pontifications.
That might make this good news turn to bad news, as I then will be on the hook for the full premium of what I wouldn’t be surprised to find would be an inferior and more expensive product than I have now (keeping my present insurance plan was not an option as it’s being canceled at the end of the month).
For those of you who are signing up for health insurance in this period of flux, I recommend that you seriously consider a plan that allows you to contribute to a Health Savings Account.
Such plans usually have higher deductibles, so you have to be comfortable with that, but Health Savings Accounts are a good way to shield a good hunk of your income from federal income tax.
At the last minute, Congress has approved a bill that extends certain tax provisions and makes other tax law modifications.
Dubya is expected to sign it into law.
Among the parts of this bill that will be of interest to Picket Line readers are the following:
