H.R.111 - To amend the Internal Revenue Code of 1986 to allow an above-the-line deduction for health insurance premiums. (119th Congress)
Summary
H.R. 111 proposes amending the Internal Revenue Code of 1986 to allow an above-the-line deduction for health insurance premiums. This means individuals can deduct these premiums from their gross income, reducing their taxable income, regardless of whether they itemize other deductions. The bill aims to make healthcare more affordable by providing a tax benefit for health insurance expenses.
Expected Effects
The primary effect of this bill would be to reduce the tax burden on individuals who pay health insurance premiums directly. This could lead to increased access to healthcare as it lowers the after-tax cost of insurance. However, it could also reduce overall tax revenue for the government.
Potential Benefits
- Reduced Tax Burden: Individuals can deduct health insurance premiums, lowering their taxable income.
- Increased Affordability: Healthcare becomes more accessible due to the reduced cost of insurance.
- Simplified Tax Filing: An above-the-line deduction simplifies tax preparation, especially for those who don't itemize.
- Potential for Increased Coverage: More people may be able to afford health insurance, leading to higher coverage rates.
- Financial Relief: Provides financial relief for families and individuals struggling with healthcare costs.
Most Benefited Areas:
Potential Disadvantages
- Reduced Tax Revenue: The government will collect less tax revenue, potentially impacting other programs.
- Complexity in Implementation: Defining eligible premiums and preventing abuse could be complex.
- Potential for Increased Premiums: Insurers might raise premiums knowing individuals receive a tax deduction.
- Disproportionate Benefit: Higher-income individuals may benefit more due to higher tax brackets.
- Limited Impact: The deduction may not be substantial enough to significantly impact healthcare affordability for low-income individuals.
Most Disadvantaged Areas:
Constitutional Alignment
The bill aligns with the general welfare clause of the Constitution (Preamble), as it aims to promote the health and financial well-being of individuals. Congress has the power to lay and collect taxes (Article I, Section 8), and this bill represents an adjustment to the tax code. There are no apparent conflicts with specific constitutional provisions.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).