House Approves Bill Restoring Pre-PPACA Medical Expense Deduction

first_imgCCH Tax Day ReportThe House approved legislation to restore the medical expense deduction to its parameters before the Patient Protection and Affordable Care Act (PPACA) (P.L. 111-148) by a vote of 261 to 147 on September 13. The Halt Tax Increases on the Middle Class and Seniors Bill (HR 3590) now goes to the Senate.Starting in 2013, the PPACA increased the threshold to claim an itemized deduction for unreimbursed medical expenses from 7.5 percent of adjusted gross income (AGI) to 10 percent of AGI. A temporary exemption for individuals age 65 and older is set to expire December 31, 2016.“This will provide broad-based tax relief to middle and low income families as they continue to struggle in difficult economic times,” Michael Burgess, R-Tex, said on the House floor. HR 3590 permanently lowers the threshold for the deduction for all taxpayers regardless of their age, Burgess added.Rep. Jared Polis, D-Colo., spoke in opposition of the bill, cautioning against its more than $30-billion cost in lost federal revenues. “It trades a tax cut today for a tax increase tomorrow,” Polis said.Rep. Kyrsten Sinema, D-Ariz., supported the measure, saying on the House floor, “Middle-income families are more likely and more able to claim this deduction. ” According to IRS data, 84 percent claiming this deduction make less than $ 100,000 a year, Sinema said.White HouseThe Obama administration released a Statement of Administration Policy on September 13 opposing House passage of HR 3590. “It would repeal a provision of the Affordable Care Act that limits a regressive, poorly targeted tax break for health care spending,” the administration said. If President Obama is presented with the bill, his senior advisors would recommend a veto, according to the statement.By Jessica Jeane, Wolters Kluwer News StaffStatement of Administration Policy on HR 3590 – Halt Tax Increases on the Middle Class and Seniors ActWays and Means Press Release: Levin Floor Statement on HR 3590last_img