This is to laugh:
Under ObamaCare©, your 26 year old "baby" is generally eligible to stay on your health plan (or re-up to it if the little darlin' had already "aged off"). And it means that the insurance benefit remains non-taxable to said "dependent." Which is fine, if you have a typical, generic "co-pay" plan.
But what if you were a savvy buyer, and own a High Deductible Health Plan (HDHP) and a Health Savings Account (HSA)? Well, the premiums for the HDHP are still non-taxable, but any HSA distributions may not be.
Here's the problem: ObamaCare© defined "dependent" in the context of the insurance policy, but the HSA isn't "insurance," it's money. So it continues to operate under the pre-existing rules regarding dependents, which is a completely different definition.
Result: disbursements for Junior who doesn’t meet the definition of “tax dependent” may be considered nonqualified, which means subject to some pretty hefty taxes and penalties.
How hefty, you ask?
Well consider that, next year, the penalty on nonqualified disbursements is increasing from 10% to 20%. Ouch!
Hmmm, maybe we shoulda read it before we passed it? Naaaah!
Under ObamaCare©, your 26 year old "baby" is generally eligible to stay on your health plan (or re-up to it if the little darlin' had already "aged off"). And it means that the insurance benefit remains non-taxable to said "dependent." Which is fine, if you have a typical, generic "co-pay" plan.
But what if you were a savvy buyer, and own a High Deductible Health Plan (HDHP) and a Health Savings Account (HSA)? Well, the premiums for the HDHP are still non-taxable, but any HSA distributions may not be.
Here's the problem: ObamaCare© defined "dependent" in the context of the insurance policy, but the HSA isn't "insurance," it's money. So it continues to operate under the pre-existing rules regarding dependents, which is a completely different definition.
Result: disbursements for Junior who doesn’t meet the definition of “tax dependent” may be considered nonqualified, which means subject to some pretty hefty taxes and penalties.
How hefty, you ask?
Well consider that, next year, the penalty on nonqualified disbursements is increasing from 10% to 20%. Ouch!
Hmmm, maybe we shoulda read it before we passed it? Naaaah!
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