The Republican bill to repeal and replace Obamacare contains some goodies for the wealthy.
Under the Affordable Care Act, single taxpayers with incomes above $ 200,000 and couples making more than $ 250,000 annually have had to pay an additional 0.9% Medicare payroll tax on the amount they earn above these thresholds. These taxpayers may also be hit with a tax surcharge of 3.8% on investment income above those thresholds. These taxes have been in place since 2013.
Ending Obamacare would mean that nearly everyone in the Top 1% who earn more than $ 774,000 a year, would enjoy a hefty tax cut, averaging $ 33,000, according to a report published in December by the non-partisan Tax Policy Center. Those in the Top 0.1% would get an average tax cut of about $ 197,000.
The bill also contains other benefits for those with money.
It would allow folks to contribute more to Health Savings Accounts, which are primarily used by better-off Americans who can afford to sock money away for health care expenses. The bill would increase the limit to cover the deductible and out-of-pocket expenses allowed under high deductible plans. For individual coverage, this would be $ 6,550 for individuals and $ 13,100 for families beginning in 2018. The current limit is $ 3,400 for an individual and $ 6,750 for a family.
Also, the Republicans would enable people higher on the income scale to claim the tax credit to help pay their premiums. Under Obamacare, an enrollee who makes more than $ 47,500 is no longer eligible for a subsidy. The GOP plan would let a policyholder making up to $ 75,000 and families earning $ 150,000 claim the full tax credit. The benefit would phase out slowly until the enrollee hits $ 215,000 in income or a family hits $ 290,000.