ObamaCare Has Increased Taxes
Posted by taxguru on September 23, 2014
From a Client:
Subject: Kerry, do you happen to know…
Kerry, at a recent Round Table one of our Members made the assertion that “the ACA is lowering the cost of care.” To which I retorted, “yes, but at the taxpayers’ expense.” To which he responded “the tax rates haven’t increased since 2008.”
It’s hard for me to believe that millions of Americans are getting basically a “free lunch – or heavily subsidized health plan (or even expanded Medicaid)” without more tax dollars going toward it. Figured you know these things. Is there something you can point me to that broadly covers how the tax structure (for those who are paying taxes) has changed since 2008 in general, and particularly since 2010, when the ACA went into effect. Many thanks in advance,
Your gut feeling was correct and the member was wrong.
The actual increase in taxes for ObamaCare is spread out over a number of ways.
As you can see on this handy recap of Federal tax rate brackets, there was a new 39.6% bracket added to individual income tax rates for 2013. From 2003 through 2012, the top rate was 35%.
On top of that, there was also a new 3.8% tax starting in 2013 on net investment income that was directly from the ObamaCare legislation. That tax, on Form 8960, actually cost you $5,806 for 2013.
Additionally, the maximum tax rate on long term capital gains has increased from 15% (2008-2012) to 20% (2013 & after). While some may look at that as just a five percent increase, it actually represents a 33.3% increase from the previous top rate.
There is an interesting article on states having to pay additional costs for ObamaCare:
Overall, the percentage of taxes being paid by the top earners in this country continues to increase every year. There are lots of articles on this, such as this one:
One aspect that is swept under the rug is the fact that a lot of the increased spending by the Federal government isn’t really being paid directly by anyone right now because it is being borrowed from the Chinese government. The fact that those loans, plus interest, will need to be repaid someday, is something our rulers in DC refuse to acknowledge as they keep adding trillions of dollars to the debt.
I hope this info is useful for you.
This is great! Thank you very much….now I just need to break it to him!
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