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May 12, 2009 at 08:00 PM
Office of Management and Budget officials have salted the latest edition of Analytical Perspectives with many ideas for increasing tax revenue and cutting tax expenditures.
The ideas getting the most attention from insurers are described in a section of the Obama administration’s Analytical Perspectives budget documen that concerns efforts to create a Health Reform Reserve Fund.
The same document also lists a list of “loophole closers” that could affect some life insurers. Some would limit shifting of income through intangible property transfers; repeal the 80/20 rules, which determine whether a U.S. company does enough business overseas for its interest and dividend payments to be treated as foreign-source income; prevent use of equity swaps to avoid dividend withholding taxes; and fight under-reporting of income through use of accounts and entities in offshore jurisdictions.
Another provision that could affect some insurance company executives and financial services clients would phase out and limit itemized deductions of expenses, including medical expenses, for single taxpayers with annual taxable incomes over $200,000 and married filers with incomes over $250,000.
A third provision would require employers with 10 or more employees that do not offer retirement benefits to enroll employees in individual retirement accounts automatically starting in 2012. Employees could opt out, but employees who failed to opt out would have 3% of their compensation go into the IRA automatically.
Elsewhere in the Analytical Perspectives document:
Page 58 – The Obama administration casts doubt on the idea that group life insurers will have an easy time getting themselves included in the Terrorism Risk Insurance Program.
