Obama Clamps Down on Flexible Spending
Indeed, those “flexible spending accounts” which your employer may offer, or that “health savings account” which you may have in place will have to contend with some new limitations, thanks to last year’s health care “reform” legislation.
One of the provisions of that piece of work took effect this most recent New Year’s Day, and will restrict one’s ability to use pre-tax dollars (via the kinds of accounts mentioned above) to buy the previously allowed non-prescription, and some over the counter medicines. No more aspirin, antihistamines, anti-ulcer pills, hemorrhoid cream or anti-flatulence medicines, among others.
Thanks Barack – you’re just doing a heckuva job!
And a recent decision of the Tax Court reminds taxpayers to understand what they’re doing when they terminate that life insurance policy, from which they borrowed some of the investment build up some time ago, and just don’t want to (or, maybe, can’t) repay the loan and accrued interest.. The case of John Morgan Sanders came to the same conclusion as many other cases before it – and for the unsuspecting, receipt in the new year of that 1099-R (ordinary income) from the insurance company comes as a rude awakening.
And as Obama and his clan return from warmer climes, this week, we learn something of the costs associated with taxpayers’ largesse associated with the recent Hawaii vacation. A few tidbits from an investigation conducted by the Hawaii Reporter:
~Cost of Mrs. O’s early departure (she just couldn’t wait to get there), requiring
a separate plane, of course: $63,000
~Costs for White House staff staying at Moana Hotel (excluding meals): $134.400
~Police overtime: $250,000
Just a few of the items, totaling about $1.5 million is all. Of course, the lodging for the first family and their closest friends in three luxury beachfront hostels, including the “Winter White House” typically rented for $3,500 per day is included in the total tab.
But of course, we wouldn’t expect the first fam to hole up in just any flea trap, would we? Surely they need all 7,000 square feet, including 5 bedrooms, waterfalls, and an island spa.
And you say you’re unemployed and upside down in your house?
Finally this week comes word from the IRS that they are extending the life of the mediation and arbitration programs which they have been testing for several years. The Revenooers note that such “alternate dispute resolution programs are consistent with the IRS’s efforts to improve tax administration and enhance customer service.”
Our experience with components of this program have been anything but “customer service” friendly. Mostly PR razzle dazzle, we think.
CONSULT YOUR TAX ADVISOR – This article contains general information about various tax matters. You should consult your CPA regarding the implications to your own particular situation.
Jeff Quinn, the author of this article, is a shareholder in Ashley Quinn, CPAs and Consultants, Ltd., with offices in Incline Village and Reno. He is also a contributor to the recently published 14th edition of Tax Savvy for Small Business, published by Nolo. He can be reached at 831-7288, and welcomes comments below or at email@example.com.