Skip to main content

Fun with math: Obama's health care 'tax increase' on the middle class

Daniel Foster points to this Hill story, showing that Obama's health reform bill will actually sock the middle class with tax increases. The bolded parts are Foster's emphases:

Taxpayers earning less than $200,000 a year will pay roughly $3.9 billion more in taxes — in 2019 alone — because of healthcare reform, according to the Joint Committee on Taxation, Congress' official scorekeeper for legislation.

The new law raises $15.2 billion over 10 years by limiting the medical expense deduction, a provision widely used by taxpayers who either have a serious illness or are older.

Taxpayers can currently deduct medical expenses in excess of 7.5 percent of their adjusted gross income. Starting in 2013, most taxpayers will only be allowed to deducted expenses greater than 10 percent of AGI. Older taxpayers are hit by this threshold increase in 2017.

Once the law is fully implemented in 2019, the JCT estimates the deduction limitation will affect 14.8 million taxpayers — 14.7 million of them will earn less than $200,000 a year. These taxpayers are single and joint filers, as well as heads of households.

"Loss of this deduction will mean higher taxes for 14.7 million individuals and families making under $200,000 a year in 2019," Sen. Chuck Grassley (R-Iowa) told The Hill. "The new subsidy for health insurance would not be available to offset this tax increase for most of these households."

A little more math here is helpful, though: 14.7 million taxpayers will lose the deduction; they'll get hit with a collective $3.9 billion in new taxes in 2019. That means each taxpayer (and taxpaying household) will see an average tax increase of ... $26.

Clearly, socialism is bringing confiscatory tax rates to America.

Funny, though, Foster's excerpt skipped The Hill's line right after the Grassley quote:

The healthcare law contains tax breaks for individuals purchasing health insurance, but the breaks phase out for those making $88,000 a year.

So: The average tax increase of $26 a year will apply to families making between $88,000 and $200,000 a year. Even if you're on the low end of that scale, that average $26 increase will consume roughly three-tenths of one percent of your income!

I suppose that technically, this violates Obama's promise not to raise taxes of people making less than $250,000 a year. In reality, I'm not sure they'll notice it all that much. Unless organizations like The Hill continue to force readers to do the math to put these things in context -- and let Republicans needlessly scare the middle class.

UPDATE: The back of the envelope is no match for a calculator. I failed to carry a "zero" somewhere: Actual numbers are a $265 a year increase for those 14.7 million people. That's a bigger and more-noticeable number, to be sure. Still three-tenths of one percent of the $88,000-a-year income though. (How the hell did I make that mistake?)


namefromthepast said…
Hey Joel

One idea why the zero wasn't carried is that libs are simply too focused on carrying the one in the white house.

Cheap jab I know but instead of pressing the particulars of the numbers I'd like to pose a different question.

Is this math relavant? The blog on the article on the article may miss the point entirely.

Libs point to the CBO which had to score the bill with its author's assumptions, which, I believe, is better fodder for debate-not the CBO's or JCT's mathematical, scientific conclusions. aka SWAG.

Let's not "do the math" based on gov't forecasts. Remember when you can't cut it being a weatherman you are still top of the class at CBO. "Hey!! Who's hockey stick is that?"

Medicare, Medicaid, Social Security...accurate forecast of costs?

Conservatives will appeal to common sense and experience to ask "Does the answer really make sense?"

This may be the storyproblem we all did in high school that libs need to concern themselves.

...."if a train leaves the station in 2010 carrying 10 years of tax revenue and arrives in 2019 only having to have paid 6 years of benefits how much excess tax revenue should it have on board?" Common sense says 40% extra, Libs say "It's almost empty!"

"Fun with math" indeed.
Notorious Ph.D. said…
And just when did an annual household income of $199K become "middle class"?

Kelly C said…
No one's perfect. You are allowed to be bad in math, on occasion.

Keep up the feisty rhetoric, the math will take care of itself.


Popular posts from this blog


I've been making some life changes lately — trying to use the time I have, now that I'm back in Kansas, to improve my health and lifestyle. Among the changes: More exercise. 30 minutes a day on the treadmill. Doesn't sound like a lot, but some is more than none, and I know from experience that getting overambitious early leads to failure. So. Thirty minutes a day.

One other thing: Yoga, a couple of times a week. It's nothing huge — a 15-minute flexibility routine downloaded from an iPhone app. But I've noticed that I'm increasingly limber.

Tonight, friends, I noticed a piece of trash on the floor. I bent over at the waist and picked it up, and threw it away.

Then I wept. I literally could not remember the last time I'd tried to pick something off the floor without grunting and bracing myself. I just did it.

Small victories, people. Small victories.

Liberals: We're overthinking this. Hillary didn't lose. This is what it should mean.

Nate Cohn of the New York Times estimates that when every vote is tallied, some 63.4 million Americans will have voted for Clinton and 61.2 million for Trump. That means Clinton will have turned out more supporters than any presidential candidate in history except for Obama in 2008 and 2012. And as David Wasserman of Cook Political Report notes, the total vote count—including third party votes—has already crossed 127 million, and will “easily beat” the 129 million total from 2012. The idea that voters stayed home in 2016 because they hated Donald Trump and Hillary Clinton is a myth. We already know the Electoral College can produce undemocratic results, but what we don't know is why — aside from how it serves entrenched interests — it benefits the American people to have their preference for national executive overturned because of archaic rules designed, in part, to protect the institution of slavery. 

A form of choosing the national leader that — as has happened in …

I'm not cutting off my pro-Trump friends

Here and there on Facebook, I've seen a few of my friends declare they no longer wish the friendship of Trump supporters — and vowing to cut them out of their social media lives entirely.

I'm not going to do that.

To cut ourselves off from people who have made what we think was a grievous error in their vote is to give up on persuading them, to give up on understanding why they voted, to give up on understanding them in any but the most cartoonish stereotypes.

As a matter of idealism, cutting off your pro-Trump friends is to give up on democracy. As a matter of tactics, cutting off your pro-Trump friends is to give up on ever again winning in a democratic process.

And as a long-term issues, confining ourselves to echo chambers is part of our national problem.

Don't get me wrong: I expect a Trumpian presidency is a disaster, particularly for people of color. And in total honesty: My own relationships have been tested by this campaign season. There's probably some damage…