“I can make a firm pledge. Under my plan, no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes,”
President Obama, September 12, 2008
REAL ESTATE SALES TAX
Beginning January 1, 2013, ObamaCare imposes a 3.8% Medicare tax on unearned income, including the sale of single family homes, townhouses, co-ops, condominiums, and even rental income.
In February 2010, 5.02 million homes were sold, according to the National Association of Realtors. On any given day, the sale of a house, townhome, condominium, co-op, or income from a rental property can push middle-income families over the $250,000 threshold and slam them with a new tax they can’t afford.
This new ObamaCare tax is the first time the government will apply a 3.8 percent tax on unearned income. This new tax on home sales and unearned income and other Medicare taxes raise taxes more than $210 billion to pay for ObamaCare. The National Association of Realtors called this new Medicare tax on unearned income “destructive” and “ill-advised” and warned it would hurt job creation.
- It raises taxes by more than a half-trillion dollars over the next 10 years B the largest tax increase in American history.
- It cuts more than a half-trillion dollars from Medicare to finance a new entitlement, and includes a series of additional gimmicks that hide the true cost of the legislation.
- It adds to an already unsustainable rate of government spending growth that will overwhelm the Federal budget and sacrifice the Nation’s future prosperity.
But if you can change it, Armageddon! Grandma being thrown off a cliff! Medicare will end and Seniors will be thrown out into streets to fend for themselves against the evil corporate pack wolves and they will be ripped apart by the evil capitalists!!!
You can’t live without Government controlling of your life! 🙂
Want to avoid Obamacare:
President Obama’s solicitor general, defending the national health care law on Wednesday, told a federal appeals court that Americans who didn’t like the individual mandate could always avoid it by choosing to earn less money.
Neal Kumar Kaytal, the acting solicitor general, made the argument under questioning before the U.S. Court of Appeals for the Sixth Circuit in Cincinnati, which was considering an appeal by the Thomas More Law Center. (Listen to oral arguments here.) The three-judge panel, which was comprised of two Republican-appointed judges and a Democratic-appointed judge, expressed more skepticism about the government’s defense of the health care law than the Fourth Circuit panel that heard the Virginia-based Obamacare challenge last month in Richmond. The Fourth Circuit panel was made up entirely of Democrats, and two of the judges were appointed by Obama himself.
The new Medicare investment tax provides a disincentive for business expansion. The National Federation of Independent Business (NFIB) reports, “The $250,000/$500,000 thresholds only apply to the sale of a primary residence, so the tax will hit other property sales harder.”
NFIB also points out that this tax “marks the first time that non-wage income is designated to fund Medicare.” Beyond its marginal effects on real estate sales, the new application of the Medicare tax to investment income will have substantial effects on the economy at large. Analysts in Heritage’s Center for Data Analysis write, “Raising the tax burden on investment income further damages the economy and ultimately affects all members of society.” Their findings show that this tax will result in lost job opportunities, a reduction in productivity, losses in gross domestic product, and reductions in household income.
So is there a sales tax on real estate included in the health care law? In some cases, yes. But will the same provision that taxes some profits from real estate cause widespread damage to the economy? Absolutely.
The issue is not whether Medicare costs should be controlled but how. Congress can pursue one of two routes: (1) It can change the structure and culture of Medicare to empower patients to make health care decisions in order to achieve the best value, forcing plans and providers to compete for their dollars (cue the liberals screaming “ending Medicare”), or (2) it can further empower bureaucracy to impose top-down controls on the costs of services. This can indeed reduce spending, but it guarantees a simultaneous reduction in the quality of health care Americans enjoy today.
The first is the path taken by Budget Committee Chairman Paul Ryan (R–WI) in his fiscal year 2012 budget proposal. Heritage’s Robert Moffit and James Capretta write that a premium support system like the one proposed by Ryan would:
…give Medicare patients control over the flow of dollars and freedom to make decisions about how they access medical services. This will stimulate intense market competition among plans and providers, control costs, and promote rapid innovation and higher productivity through the efficient delivery of quality care, thus guaranteeing value in return for retiree premiums and taxpayer dollars.
Last week, President Obama embraced the alternative: toughen up the bureaucracy and ratchet down Medicare payment to doctors and hospitals. The President described strengthening the Independent Payment Advisory Board (IPAB), a 15-member board of unelected officials created under Obamacare to rein in the cost of Medicare.
Under Obamacare, the board can tweak Medicare to hold growth in spending beneath its target, mainly by making cuts to provider reimbursement rates. Reducing provider payments means reduced senior access to physicians, another form of rationing of health care that already occurs to some extent in Medicare today.
Strengthening IPAB could have even more alarming consequences. The President suggested further reducing the growth rate target IPAB would act to achieve. The White House would “give IPAB additional tools to improve the quality of care while reducing costs, including allowing it to promote value-based benefit designs that promote proven services like prevention without shifting costs to seniors.” In addition, it would “give IPAB additional enforcement mechanisms such as an automatic sequester as a backstop for IPAB, Congress, and the Secretary of Health and Human Services.”