HEALTH CARE REFORM: Chapter 4

Title IV is amendments to the Internal Revenue Code of 1986, starting with Subtitle A: Shared Responsibility.

Section 401 establishes a tax on individuals without acceptable health care coverage. The tax is 2.5% of the taxpayer's modified adjusted gross income for the taxable year, over the amount of gross income to be established later. The tax imposed cannot exceed the applicable national average premium for the year. The tax can be prorated for part of the year. There are exemptions for individuals living outside of the U.S. and individuals living in possessions of the U.S. There's even a religious conscience exemption.

Section 411 gets into the employer's responsibulity. These items are the same as in Title III.

Section 421 is about a credit for small business employee health coverage expenses. Section 431 is about disclosure of return information for health insurance exchange subsidies. I read that some opponents were concerned about the Health Choices Administration having access about tax return information, but the solution is simple. If you are eligible but don't want them to see your tax return, don't opt to apply for an affordability credit. The provision provides for sufficient restrictions when handling personal information.

Section 441 calls for a "surcharge" on high income individuals. The provision establishes new tax of 1% of an individual's modified gross income exceeding $350,000 but not exceeding $500,000; 1.5% of income exceeding $500,000 but not $1,000,000; 5.4% of income exceeding $1,000,000. In December 2012, if the excess Federal health reform savings is more than $150,000,000,000 but not more than $175,000,000,000 (not likely, folks) 2% will be substituted for 1% and 3% will be substituted for 1.5%. If excess federal health reform savings are more than $175,000,000,000 as of December 2012, the 1% and 1.5% taxes will be eliminated completely!

Translation: upper income folks, your taxes are going up.

There are a few other Internal Revenue Code amendments, but they really didn't seem like they were making big changes.

In summary: you can be taxed if you do not have health insurance; your employer must offer coverage or pay contributions to the Health Insurance Exchange; taxes are going up at least 1% on annual incomes over $350,000.

We're on Page 215, and already next up is Division B: Medicare and Medicaid Improvements.