| Overview of Changes Taking Place in 2010:
Adoption
Credit Increase & Adoption Assistance Program - Increase in adoption tax
credit and assistance exclusion by $1,000. The bill makes the credit refundable and extends it through 2011.
Tanning
Excise Tax - A 10 percent tax will be imposed on amounts paid for indoor
tanning services on or after July 1.
Small
business Health Care Tax Credit - Businesses with fewer than 25 employees
will get tax credits covering up to 35 percent of their health care premiums,
increasing to 50 percent by 2014.
Overview of Changes Taking Place in 2011:
W-2
Reporting Of Health Insurance - Companies will be required to include the value
of employer provided health coverage as
an information disclosure on the W-2.
SIMPLE Cafeteria Plans - A new SIMPLE cafeteria plan to provide a vehicle for small
businesses to offer tax-free benefits
will be created. This will ease the small employer's administrative burden of sponsoring
a cafeteria plan. If the employer sets up the plan, the employer is required to provide benefits equal to 2% of gross pay
or the lesser of 6% of pay or twice the employee's contribution, regardless
of whether the employee participates. The rules
apply only to
non-highly compensated or key employees, but must be available to anyone else
who works
at least 1,000 hours during the plan year. Employees under 21, with less than 1 year
of service, nonresident aliens and union employees may be excluded.
Over The Counter Reimbursements From Flex & HSA Prohibited - HSA and flex
plan withdrawals may no longer be used for over the counter drugs unless
physician prescribed.
Overview of Changes Taking Place in 2012:
1099
Change For Corporate Payments - Businesses making payments of more than $600 to
corporations will now have to issue
1099's to the corporations for both goods and services. If a business files more than 250 Form
1099-MISC's, they are required to file them electronically.
Overview of Changes Taking Place in 2013:
Increase In Medical Itemized Deduction Base For Under 65 to 10% - There will be
increases to the income threshold from 7.5 percent to 10 percent of adjusted gross income for medical expense deductions.
Those older than 65 can claim the 7.5 percent deduction through 2016.
.9% Surcharge Tax In Medicare For High Income Taxpayers - The Medicare
payroll tax will increase from 1.45 percent to 2.35 percent for individuals earning more than $200,000 and married filing
jointly above $250,000. This will be paid only by the employee, it is not matched
by the employer.
3.8% Surcharge Tax For Unearned Income For High Income Taxpayers - Unearned
income will be subject to a special 3.8% surcharge tax for singles with AGI over $200,000 and married filing joint over
$250,000. Unearned income includes interest, dividends, capital gains,
annuities, royalties and passive rental income, but not tax-exempt interest or qualified
retirement plan withdrawals.
Contributions To Flexible Savings Accounts Limit - Contributions to flexible savings accounts will be limited to $2,500 per year.
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