“If you want a happy ending, that depends, of course, on where you stop your story.” – Orson Welles

I hope your Father’s Day was special…that you took the time to thank (or remember) your father, wherever he may be.

On to the subject of my note: You know, I deal with taxes all the time of course…it’s my job, right?

But that still doesn’t mean I <span style=”text-decoration: underline;”>like</span> paying taxes–who does? Certainly none of us are opposed to contributing to the necessary functions of our government–police, roads, fire, administration, etc.

Yet I must say that I really do take a special pleasure in helping my clients keep their tax obligations to a minimum. Dave Ramsey calls the unnecessary fees and payments we make when we don’t make wise financial decisions the “stupid tax”.

Well, I won’t be so blunt perhaps–but the unnecessary taxes which many families pay because they just don’t have the time to follow all the changes and updates to our gargantuan tax code…well, that’s another kind of “stupid tax.”

A couple items from last week really brought this to my mind, the first I’ll just mention briefly and the second will be the subject of my full Personal Strategy Note.

First–did you see this? <a href=”http://money.cnn.com/2009/06/12/technology/irs_cellphones/index.htm?postversion=2009061215″>http://money.cnn.com/2009/06/12/technology/irs_cellphones/index.htm?postversion=2009061215</a> Looks like in their never-ending search for new sources of revenue, the IRS is considering taxing usage of an employee cell phone for non-work purposes. Watch this space…I’ll let you know if they end up following through.

But the bigger news is the health care debate, and how to pay for all of the changes which are being considered. Whatever they decide may affect you, so read on… and let me know if I can help!
<h2>”Real World” Personal Strategy</h2>
<h2>Taxing Health Care…and What It Could Mean For You</h2>
I pay attention to Washington politicians and their tax tendencies so you don’t have to!

You see, President Obama has announced he is open to the idea of taxing Americans on the value of their employer-provided health benefits. Right now, benefits are not taxed, but the congressional Joint Economic Committee estimates that this tax “break” costs the Treasury $226 billion per year in revenue.

The goal, here, would be to raise revenue to thereby pay for coverage for those who currently have no insurance, those who can’t afford the insurance they do have, and those struggling to pay for continued health insurance in the wake of losing their job.

It’s a new proposal, and the details aren’t all out there. However, what I think is the most likely scenario, is that they would seek to tax coverage above a certain ceiling. If Congress sets that ceiling at $1,000 per month, and your employer pays $1,250 per month for your coverage, you would be taxed on the extra $250 per month.

Taxing benefits would reverse decades of tax-free treatment dating all the way back to World War II. It’s a thorny issue for Obama because of promises he made on the campaign trail not to tax these items…but they seem to be pretty serious about getting something done on the health care front.

Unfortunately, the proposal would likely mean substantial middle-income tax increases. That’s because the extra tax is tied to the value of health care benefits, not income. Many middle-income earners with comprehensive benefit packages, like teachers and other municipal employees, could see their tax obligation shoot up.

Health care reform has been a consistent issue in Washington. Back in 1984, President Reagan proposed taxing benefits above $2,100 per year. Back then, strong opposition, especially from labor unions, torpedoed the idea. But healthcare costs have soared to the point where the average family’s health insurance premium is often more than the average family’s mortgage. So while this latest proposal is no sure thing, we all have to take it seriously.

<strong>Fortunately, there are strategies that employers and families can use to cut the overall cost of health care.</strong> And many of them rely on the tax code–and it’s something we can help you with. Flexible-spending accounts, Health Savings Account plans, and Section 105 Medical Expense Reimbursement Plans can all help beat the high cost of health care.

So…if you’re worried about your health care costs, call us or drop me an email to see how we can help. We can take you by the hand and walk you through this stuff. We can even give you ideas to take to your employer!

When it comes to rising health care costs–and the taxes which may accrue–don’t ever believe you don’t have anybody on YOUR side!

To your family’s financial health!