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Trump Revokes Healthcare Subsidies
Things Just Got REAL Crazy!
Trump Revokes Healthcare Subsidies! Now What?
Skipping the GEAR UP 1040 CANNOT an Option

by Jon A. Hayes, Executive Director

October 13, 2017 - For the record, this is Friday the 13th . . . and no, President Donald Trump throwing a major wrench into the healthcare machine is not some kind of joke.

Our unpredictable president announced yesterday that government subsidies for healthcare coverage are illegal since they were established by the Obama presidential pen and not authorized by Congress as the constitution dictates. He signed that order this morning.

So essentially, health insurers cannot expect $7 billion in government aid in 2018 to reduce healthcare costs for qualifying low-income families, leaving insurers the choice of either increasing the cost of those policies or increasing the cost of healthcare policies of non-subsidized policyholders to make up the difference. Many industry experts believe insurers could partially increase all policies to make up for the loss in subsidies.

Read: Trump Plans to End Healthcare Subsidies

Waiting until now to make the announcement will cause much stress for Americans as they seek to renew or replace healthcare policies, and it places extreme pressure on insurers to re-calculate plans and rates quickly so insurance shoppers can meet Obamacare deadlines for coverage and tax reporting purposes.

In the meantime, several state attorneys general are assembling lawsuits seeking to prevent the Trump Administration from revoking these valuable subsidies. At this writing, Michigan has not indicated that it will participate in that legal action, although the state receives substantial subsidies from the federal government for its Medicaid insurance program.

Additional Tax Implications of Executive Order

This morning's executive order also expands choices and alternatives to Obamacare plans that would supposedly increase competition to bring down costs for policyholders. The full extent of its effects  are not clear at this writing since it directs affected agencies to issue new regulations and guidance and that could take months.

Possible tax-related changes could also include allowing businesses to use health reimbursement accounts (HRAs) to pay for their premiums and new qualifying association health plans (AHPs) -- the so-called "Rand Paul Plan" that re-establishes associations that can pool small businesses and then shop for group insurance coverage offering a lower rate since risk is shared by a defined larger group.

So How Does This Impact
Tax Preparation for Healthcare Reporting?

The answer is, nobody is sure at this point. With the recent IRS reversal on auditing so-called 2016 "silent returns" where the taxpayer simply left healthcare reporting lines blank (reversing its earlier position on ignoring those returns and essentially ignoring a Trump Administrative directive), it appears the Service has every intention of enforcing all ACA provisions.

See NSA News Below for Analysis of Proposed Tax Reform

GEAR UP Will Have the Answers

Our partners at GEAR UP Seminars will provide all the answers you need on healthcare reporting, tax changes, and much more, starting with their 1040 seminars this November (November 6-7 in Novi and November 29-30 in Bath) and ending with their patented tax update webinar (free with a registration to one of MTAP's GEAR UP 1040s).

This is no longer a "year with no tax changes" as we've heard some preparers say to justify skipping the annual 1040 update. It's now become an essential seminar and could become a critical seminar should Congress pass Trump's tax reform package by the end of the year as they have promised.

And who knows what more this Administration can do to muck up tax season? The possibilities seem endless. As a member of MTAP, we will continue to keep you updated, and when and if necessary, we'll assemble last-minute education if warranted.

In the meantime, if you haven't registered for a GEAR UP 1040, either click a link below to register online or call us at 517-641-7505 with a credit card payment.

Reserve Your Seat Now:

2017 GEAR UP 1040 Tax Seminar - NOVI
November 6-7, 2017 (Monday-Tuesday)
Sheraton Hotel, Novi, Michigan

14 CPEs in Taxation and 2 CPEs in Ethics Available

2017 GEAR UP 1040 Tax Seminar - BATH
November 29-30, 2017 (Wednesday-Thursday)
Eagle Eye Golf Club, Bath, Michigan

14 CPEs in Taxation and 2 CPEs in Ethics Available

IAAM P.O. Box 398 Bath, MI 48808-0398