Another Obamacare tax

We have posted about this before, but, a caller to Jim’s show on Thursday, prompts another look.

The caller explained that his W-2 (as does everyone else who has employer provided health insurance) now includes a line for insurance benefits paid by his employer on his behalf.  The caller wondered why this was.  I doubt he will like the answer.

Those in Congress whose stated purpose is to tax and spend have always been very annoyed that some employers provide insurance to their employees, but, the employee doesn’t pay taxes on the value of that benefit. Look at the gusher of revenue to the federal government were those payments taxable.  Obamacare fixes all that in a two step process.

Beginning in 2018, if you have employer provided insurance where the benefits exceed $10,200 as an individual, or $27,500 for a family, you will pay an excise tax on all benefits in excess of those minimums.  This is what they have fondly called the “cadillac insurance tax”.

The other thing that needs to happen is that lots of folks need to be subjected to this tax to generate the tax revenue gusher.  The second step in Obamacare to insure this “windfall” is to make sure that employer provided insurance becomes “pricey”.  This is accomplished by mandating that all kinds of coverage (like it or not) be included in insurance coverage to avoid the tax for failing to have government mandated coverage.

Voila…the government mandates all kinds of coverage, thus driving the price up, and then the government taxes you for having pricey insurance once that price is driven up…by the government.  Here are some examples:

  • A business employee on a family plan would owe $86,905 in additional taxes from 2018-2028
  • A police officer on a family plan would owe $53,907 in additional taxes from 2018-2028
  • A teacher on an individual plan would owe $20,807 in additional taxes from 2018-2028

I certainly can’t vouch for the validity of those numbers, but, I hope you get the picture.

If you don’t have perfectly perfect insurance coverage as demanded by the government, you pay a tax for failing to do so.  But, if you do, and your insurance is provided by your employer, you may end up paying a tax for complying with government demands.

Can anyone say Catch 22?


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The Sound Off Sister was an Assistant United States Attorney for the Southern District of Florida, and special trial attorney for the Department of Justice, Criminal Division; a partner in the Florida law firm of Shutts & Bowen, and an adjunct professor at the University of Miami, School of Law. The Sound Off Sister offers frequent commentary concerning legislation making its way through Congress, including the health reform legislation passed in early 2010.


  1. cherwin on February 7, 2013 at 7:48 pm

    I am so sick of all the hidden pieces of the Obamacare agenda. I would like to take the 3000 pages and feed them to Nancy Pelosi, Harry Reid and Barack Obama after they have been dragged through dog crap!

  2. Common Man on February 7, 2013 at 9:13 pm

    Sounds like they want to catch more than 22, SOS. I bet those union police & teachers are jumping for joy & can’t wait to vote Democrat again.

  3. sammy22 on February 7, 2013 at 9:33 pm

    Well, there are 2 more electoral cycles between now and 2018. By that time the Republicans should be able to conquer the White House, the House and the Senate and repeal Obamacare.

    • Dimsdale on February 8, 2013 at 3:22 pm

      I expect that more 100% and even 120% voter turnout for the media’s candidate du jour (read it: Democrat) candidate will prevent that.

  4. Marilyn on February 8, 2013 at 7:04 am

    The problem isn’t the government, it’s the people.??Government will always strive too control the people.? Some people will resist, today most will not.? Ask a middle or high school kid where their rights come from?? For that matter ask a college student?? All rights come from the government and their job is too provide all we need.? So very sad.? I am very thankful we aren’t raising children today, but wonder were and how they came too believe someone, somewhere somehow owes them a living.

  5. Lynn on February 8, 2013 at 7:17 am

    I have little hope that people will understand this either. the answer will be for government to pay for healthcare that they provide. I have already heard this from smart, intelligent progressives.

  6. Lynn on February 8, 2013 at 7:18 am

    Ok, maybe they are intellectuals and not smart.

  7. SeeingRed on February 8, 2013 at 9:05 am

    And to think, this fiasco – a more expensive healthcare structure by all accounting PLUS at least the threat of dimished services and a loss of freedom/choice – was one SCOTUS vote away from not happening.?
    I remain shocked that John Roberts opined as he did, apparently making rules out of whole cloth.? He is as personally responsible for this as Barry himself.

  8. Dimsdale on February 8, 2013 at 12:08 pm

    Just like the Alternative Minimum Tax, the line between regular and “cadillac” insurance premium benefits will be quickly overcome, and we will all? be thrust into paying more taxes eventually after ?bamacare runs up the cost of healthcare.
    Of course, it will be entirely “unexpected” and “unintended”.? Naturally.

  9. sammy22 on February 8, 2013 at 1:22 pm

    Not everybody will be affected, e.g. retirees. And it was not unexpected since is was ” in plain sight” and? easily “discovered” by SOS.

    • Dimsdale on February 8, 2013 at 3:20 pm

      Funny that the media seems to “unexpectedly” miss it.?? Not to mention our fine “representatives” when voting for it.
      And I recall that the tsunami of pro ?bama coverage and campaign ads during the election were rife with campaigning that featured stoking the flame of fear in “retirees” if ?bamacare didn’t go into effect.

  10. JollyRoger on February 8, 2013 at 3:23 pm

    Of course, ?and the most open administration in history also had every 3,000 page iteration of the bill posted for 5 day for all to read. (not!) ? Hmmm, but didn’t the nice lady say we had to vote on the bill so that we could find out what is in it? ?If you’re under 25 and you’re conservative, you don’t have a heart; but if you’re over 40 and you’re liberal, you don’t have a brain! ?

  11. Vizionmusic on February 8, 2013 at 3:44 pm

    I hate to say this- but it is largely LIBERAL WOMEN responsible for the ‘mess’ in our country ala the education system, state and fed legislatures because the WOMEN vote for this ‘crap’ and their ‘piddley-ass’ husbands and boyfriends…USUALLY go along with them! My wife and I are on the ‘outs’ for good over what is going on- she is, a ‘brain-diseased ‘Lib’ as are so MANY of my friends, associates and co-workers wives…

    • Lynn on February 8, 2013 at 4:04 pm

      I suggest you get some new friends. Why not attend a Tea Party or go to Grassroots East.

  12. sammy22 on February 8, 2013 at 6:01 pm

    Well Dims and Co., I hate to repeat myself: Obamacare is the law of the land and the SCOTUS has spoken. If you want something different, e. g. a repeal, I suggest you spend more effort in trying to convince Democrats to vote Republican next time around, and work so hard that the White House, the House and the Senate all go Republican. Are you up to it? And may Nemo spare your house and town.

    • Dimsdale on February 9, 2013 at 9:48 am

      I agree.? Now if we could just get the media to do their job instead of being ?bama boosters, then we might have hope.??? Once it is broken though, it will probably be broken irrevocably.
      Oh, don’t forget the cheating and the “early voting” crap needs to be removed as well.

  13. Lynn on February 8, 2013 at 10:48 pm

    My hope is that people as brilliant as Dr. Benjamin Carson keep talking and right in front of President Obama. President Obama never ventures out of the confines of his cozy kingdom. He never takes questions from the Press at the WH press conferences even though they fawn over him. It is about time,, we have people embarrass him as he has done to Paul Ryan and the Supreme Court. ?
    As for working to change people’s mind, that is for everyone to do. It comes down to how do you feel about the state of the country. If you are happy with 7.8% unemployment, an Affordable Healthcare plan that will cost a family much more than we were promised, a $16 trillion debt, a State Dept that can’t figure out how to save their ambassadors from being killed, etc etc well knock yourself out. ?If you don’t like it, it’s up to you, not an amorphous us.

  14. sammy22 on February 9, 2013 at 11:03 am

    The Republicans need to put together legislative programs and candidates that will appeal to Democrats unhappy or not with the state of affairs. Until that time comes, Democrats are unlikely to switch. The last election demonstrated this very point.

  15. Lynn on February 10, 2013 at 8:35 am

    Don’t know why I can’t just drop this. But, We don’t need to appeal to Democrats. I don’t believe we can keep our principals by appealing to Democrats. The whole reason we need a two or three party system is for checks and balances. Pull to the left a little and then back to the right. The proof of that is Connecticut, it is a one party regime and we are the worst state in the Union in every category. We do need to appeal to the Unaffiliated or Independents. We can win with them in our corner, and for a few less people to stop bragging that they voted twice for Obama.

  16. sammy22 on February 10, 2013 at 10:50 am

    OK. Drop the Democrats. How are you going to appeal to an Unaffiliated like me?

    • Lynn on February 10, 2013 at 5:13 pm

      Sammy, I don’t know enough about what you want. All you write about is what both parties do that is wrong. ?All I know is there is no one candidate that could possibly be on the same side of everyone of my issues. I choose the candidate that is the most fiscally conservative and allows me to choose whether I can own a gun, choose my own healthcare, let me practice a religion and observe or not observe holidays, protects All Americans home and abroad, honors our troops above all others, does Not give raises to Congress when there is a 7.8% unemployment rate, as a President does not spend obscene amounts of money on himself for vacations when we have a $16 trillion dollar deficit and works to solve insolvency of Social security and Medicare and simplifies the tax code, preferably a flat tax oh and Torte Reform.?


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