Reply #9: This is people will lose their farms due to the DEATH tax redux

[karynnj]

The limits where you start paying under what I have read of Kerry's proposal are between $25,000 to $40,000. It is also clear that the tax is applied only to the part above the threshold. Here, it is clear they worked to find a union plan that goes above the lowest limit they can find. Now look at their example - it is $20,400. It would be affected only if the threshold was moved down to $20,000.

Even then, they have a plan where the top $400 is taxed - and the recipients are getting $20,000 in compensation tax free, when the average breaks those of us lucky enough to have employer paid insurance get is closer to $12,000 - $$16,000. Not to mention, I am jealous that they pay only $60 a month. What this is is an attack on the plan by trying to make more people think it will hurt them.

They do not stop to consider that the people with the untaxed $12,000 or $16,000 plans pay more on copays, medicines and other charges - much of which is paid with income that was taxed. In essence, this is capping a tax deduction that has helped the more affluent more than those lower on the income scale. Bill Bradley, my former Senator, was a liberal, and a very good Senator.

This is the same strategy used on the estate tax where there were all these stories of how people would lose farms and small businesses in the family for decades. Yet, one politician -maybe Kerry, I am not sure - spoke of no one being able to find even one farm where this would have happened. Here, I am suspicious because the writer obviously looked for the highest cost of a union contract she could find and failed to find one. In addition, it is written so the range Kerry is speaking of was paragraphs away and written so one would think it would be affected - when it doesn't meet the lowest possible threshold. It also ignores the fact that the tax, I think, is just on the portion over the limit.

This is also not something completely outside the box. Every year, I still get a W2 from AT&T where I retired from in 1998 for something like $6 or $7. The reason is that I still get life insurance that was determined by the salary I had when I left - it is marginally above the amount that is tax free - so that amount is income I pay taxes on. I know AT&T is self insured on health care and I assume they might be on life insurance as well.

I think the concern about companies that self insure is silly as well. On the concern that they would pass the tax through to the recipient, I don't see why an employer who buys insurance that is taxed would not have a significant chunk of that tax passed to them meaning there is little difference. Elsewhere, there was a concern that if they were self insured there would be no "price tag" is not true. They have no trouble assigning a price for COBRA. (I paid the COBRA price for a daughter who took a year break from college, who had pre-existing conditions - so this was the best (though expensive - we were super happy when she went back to school) we could do to insure her. AT&T has good insurance, but the individual policy under COBRA was I think around $800 a month. Far below this threshold.