Tax Returns Filed Here; Free Tax-Aide Help - AARP Bulletin

by Angela Bryant

For Carol McClusky, 64, the long-dreaded chore of collecting paperwork and filling out income tax forms has taken a turn for the better.

"I used to panic to go back a year and match up forms, but now it's very peaceful," the grandmother of five said.

McClusky attributes her peace of mind to AARP Tax-Aide, a free program that helps seniors and low- to moderate-income taxpayers do their taxes.

By close of business on Tax Day — this year extended to April 18 — AARP Tax-Aide will have helped McClusky and an estimated 2.5 million other taxpayers navigate complicated tax codes, ensure proper credits and deductions and file their returns to the Internal Revenue Service and state and local tax agencies.

Established in 1968 with four volunteers, the AARP Foundation program has blossomed into a national program with about 35,000 volunteers, each one trained by AARP and certified by the IRS. Last year, the volunteers helped users get refunds totaling $1.2 billion and earned income tax credits totaling $233 million.

The program is one of AARP's largest service activities, with people signing up as future volunteers year-round.

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Excise Tax on Very High-Cost Health Plans Is a Sound Element of Health Reform — Center on Budget and Policy Priorities

By Paul N. Van de Water

An excise tax on very high-cost health plans, which the Senate Finance Committee included in its health reform bill, represents a sound way to help pay for health reform. The excise tax finances nearly a quarter of the costs of the Finance Committee bill over the first ten years ($201 billion out of $829 billion) and makes a major contribution to the deficit reduction that the bill would achieve in later decades. It would help to slow the rate of health care cost growth, without which health care reform is not likely to be sustainable over time.

Of particular note, the excise tax produces savings that rise over time at least as fast as the costs of providing health insurance to those now uninsured. Without such a tax, Congress will be hard-pressed to comply with the President's pledge — and Senate rules — that the bill not increase the deficit in future decades.
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Health Care Policy and Marketplace Review: What a Tax on "Cadillac" Health Insurance Plans Would Really Mean to Mainstream Americans

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by Bob Laszewski

Milliman consulting actuary, Robert Dobson, is out with a must read paper for those that think the "Cadillac" health plan tax makes sense.

The bottom line:

"The idea of taxing so-called Cadillac plans may not sound unreasonable upon first glance. But an actuarial view quickly reveals that the high cost of these plans has as much to do with the characteristics of the covered population as it does with benefit richness. It also reveals that the method of determining the taxable benefit threshold may create unintended consequences — especially when coupled with other benefit-level requirements under various reform proposals, leaving little room between benefit floors and the ceiling in certain slices of the insurance market."

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Mandatory Health Insurance Spells ‘Tax,’ Lawyers Say - Health Blog - WSJ

A requirement that all Americans buy insurance is common to all of the major health-overhaul bills — but it’s not constitutional, write two lawyers in an op-ed in the WSJ.

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Expanding Sales Taxation of Services: Options and Issues

Sales of tangible goods dominate most states’ sales tax bases; only a few states impose their sales taxes on a broad array of services. Sales of “non-durable goods” like clothing and light bulbs and “durable goods” like cars and computers generate the vast majority of state sales tax receipts. According to the Federation of Tax Administrators, a majority of states apply their sales tax to less than one-third of 168 potentially-taxable services. Five of the 45 states with sales taxes impose them on fewer than 20 services. Read More

Press Release: Facing Deficits, More States Considering Taxing Services — Center on Budget and Policy Priorities

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Broadening the sales tax base to encompass more services, a step that tax experts have long recommended to modernize state tax systems, is receiving renewed attention because of the state fiscal crisis, according to a major new report from the Center on Budget and Policy Priorities. The report provides state-specific information on what services states now tax, how much revenue they forgo by failing to tax selected services, and how much revenue they could raise by taxing services comprehensively. Read More