| Health Savings Accounts are Getting Better with Age!
On January 1st, 2004, HSAs were enacted into law. Over the last five years, these plans have taken on further tax savings and enrollment growth. The number of people with HSA-eligible coverage rose to 6.1 million in January 2008, up from 4.5 million in January 2007, and 3.2 million in January 2006. While maintaining an HSA-eligible health plan, the HSA allows an Insured under the age of 65 to contribute pre-tax dollars into their own personal savings account. The money then can be withdrawn, pre-tax, to pay for qualified medical expenses. If the money is not spent, it rolls over into the following year.
On January 1st 2009, Georgia House Bill 977 becomes law. Under HB 977, HSA-eligible health plans are exempt from both the State and the Local insurance premium tax. Also, the bill creates an individual income tax deduction for monthly premiums for eligible plans. Corporations with fewer than fifty employees can receive a State tax credit up to $250 per employee enrolled in an HSA eligible health plan.
Also, House Bill 977 allows HSA eligible health plans to offer wellness rewards and incentives that are not allowed under current insurance law. More and more, the HSA eligible health plan is the preferred method to insure and fund Employee medical expenses.
Compliments of:
Kevin Smith, President of the Atlanta Association of Health Underwriters.
The Wall Street Bailout and it's Affects on You...
You've undoubtedly heard plenty of news about how the so-called "Wall Street bailout" law will help our troubled economy. But despite its moniker, there is a little something in the new law for "Main Street", too. Here are some highlights:
1. First and foremost, the law provides a temporary "patch" for a looming problem that could cause you and millions of other taxpayers to owe thousands in extra taxes under the alternative minimum tax. Although the AMT was originally aimed at making sure that high-income taxpayers pay their fair share and contains exemptions to prevent it from hitting middle-income taxpayers, those exemptions are not indexed for inflation. So, left alone, the AMT could affect taxpayers well down the income scale. To prevent that from happening this year, the new law temporarily raises the AMT exemption amounts for 2008.
2. The new law will also cut the tax bite for many individuals by restoring some expired tax breaks retroactively for 2008. These breaks include:
a. The option to claim an itemized deduction for state and local general sales taxes in lieu of an itemized deduction for state and local income taxes.
b. The above-the-line deduction for qualified tuition and related expenses for higher education.
c. The up-to-$250 above-the-line deduction for educators' expenses.
d. The up-to-$100,000 annual exclusion for taxpayers age 70 1/2 or older who donate IRA distributions to qualified charities.
3. The new capital gain and dividend tax rate for people in the 10% or 15% bracket (AGI below $32,550 for single, $65,100 for married filing jointly) will drop to zero. The break is scheduled to last through 2010.
4. The new standard deduction for property taxes for those taxpayers that do not itemize and pay property tax. The amount is limited to $500 if you're single, $1000 if married.
5. A New Refundable Tax Credit for First-Time Homebuyers: This would provide an interest-free loan of up to $7,500 for first-time buyers who purchase residences between April 9, 2008 and July 1, 2009. Because this essentially functions as a loan, taxpayers would have to pay this back to the government in equal installment payments over 15 years. There's a beginning phase-out level at $75,000 for single taxpayers and $150,000 for taxpayers filing joint returns. This credit must be claimed on a 2008 or 2009 tax return.
6. Business taxpayers will also benefit from revived tax breaks for 2008, including restorations of the tax credit for research expenditures, extension of special tax breaks for charitable contributions and increased depreciation write offs.
FMLA...
Changes are coming that will be in effect as of January, 2009. Right now, the totality of the impact is not clear and there is much speculation regarding the interpretation of the changes. Know this...new forms, new posting and procedural requiremnts are going to apply for your clients.
Keep watching and/or educate yourself and your clients about the major changes going on with FMLA!
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