American Health Care Act Amendment Accelerates Tax Changes
March 23, 2017
By Don Dahl, Director – Tax
Updates to the Republican healthcare plan would reduce taxes as soon as this year – a full year ahead of the original timeline proposed in the Obamacare overhaul introduced last week.
Republicans in the U.S. House of Representative have released more information for the American Health Care Act (AHCA), their follow up to Obamacare in a Manager’s Amendment. The amendment includes multiple changes to the AHCA, notably changes to the timeline for implementing some proposed tax changes.
The amendment calls for the acceleration of the repeal of the 3.8% net investment income tax (NIIT), and the acceleration of the repeal of the 0.9% additional Medicare tax, although it provides some transition time to accommodate for employer withholding. The changes made by this amendment are largely based on timing, as the repeal of both the NIIT and additional Medicare tax were included in the original AHCA.
The amendment also lowers the floor for medical expenses deductions to 5.8% from 10%. Each of these changes could be implemented this year, earlier than the previously suggested 2018 timeline. It remains to be seen whether these changes will have enough of an impact on the legislations support to ensure the bill passes through the House of Representatives.This entry was posted in News, Tax. Bookmark the permalink.