Paul Housel, district field director for Aderholt, met with the Walker County chapter of the National Association of Retired Federal Employees during the group’s meeting at Ryan’s Steakhouse Thursday morning.
Housel said many people in Alabama have contacted Aderholt’s office with concerns about new provisions of the Patient Protection and Affordable Care Act that went into effect on Sept. 23. He said Aderholt and his staff have been working to inform his constituents about the changes.
In particular, Housel said many rumors have circulated about a new income and real estate tax in the law.
“There’s an e-mail going around about it, and it’s not entirely true,” he said.
The provision in question is often referred to as the “home sales tax” or “real estate tax,” which begins in 2013. It creates a 3.8 percent tax on individuals with a modified adjusted gross income of $200,000 or above, or married couples with an income above $250,000. The tax will be multiplied by the amount of money exceeding each threshold. The tax also applies to capital gains, or profit added to one’s taxable income, from home sales that exceed $250,000 for individuals and $500,000 for married couples. The tax will be applied to all income beyond the thresholds for primary residences. All of the capital gains from second homes will be taxed.
Anyone with an income or capital gains below these thresholds will be exempt from the tax.
Another provision Housel discussed was the changes to coverage for dependents. The PPACA allows young adults to be covered under their parents’ health care insurance until the children reach age 26. Housel said, to the best of his knowledge, the dependents are not required to be enrolled in college or to live in the same household as their parents. However, the coverage is not available to dependents who can enroll in an employer-sponsored health plan.
The PPACA also prohibits health insurance providers from excluding medical care to children under the age of 19 due to pre-existing conditions.
Housel also answered questions from federal retirees concerning the provision referred to as the “individual mandate,” in which tax penalties are imposed on those who do not have health insurance. Starting in 2011, taxpayers’ W-2 forms will include the contributions made by the employee and the employer to health care coverage. Those who do not maintain minimum coverage will be required to pay a penalty. The penalty ranges from $95 in 2014 to $695 in 2016.
Housel said, though the Internal Revenue Service can withhold income tax refunds to enforce the penalty, the agency cannot use criminal penalties or liens.
Danny Gaddy, president of NARFE, said Housel’s visit was greatly appreciated by the members
“We want to thank Congressman Aderholt and certainly Mr. Housel for speaking with us about these changes and how they will affect federal retirees,” he said. “There is a lot of confusion about this law, and we are happy to have some concrete facts about the issue.”
Gaddy said the local chapter of NARFE meets the last Thursday of every month at Ryan’s Steakhouse and all federal employees and retirees are welcome to attend.