H.R.609 - Assuring Medicare’s Promise Act of 2025 (119th Congress)
Summary
H.R. 609, the "Assuring Medicare's Promise Act of 2025," aims to bolster the solvency of the Federal Hospital Insurance Trust Fund (Medicare Part A) by modifying and expanding the net investment income tax. The bill directs revenue from the net investment income tax to the Hospital Insurance Trust Fund. It also broadens the base of the net investment income tax to include certain trade or business income of high-income individuals.
Expected Effects
The likely effect of this bill is to increase funding for Medicare Part A, potentially extending its solvency. This would be achieved by increasing taxes on investment income and certain business income of high-income individuals. The bill also clarifies certain aspects of the net investment income tax, particularly regarding foreign income and previously taxed income.
Potential Benefits
- Increased funding for Medicare Part A, potentially ensuring its long-term solvency.
- Improved financial security for seniors relying on Medicare.
- Greater equity in the tax system by increasing taxes on high-income individuals.
- Potential for reduced pressure on future generations to fund Medicare.
- Clarification of existing tax law, reducing ambiguity and potential for tax avoidance.
Potential Disadvantages
- Increased tax burden on high-income individuals and potentially some small business owners.
- Possible disincentive for investment due to higher taxes on investment income.
- Complexity added to the tax code through the new definitions and calculations.
- Potential for tax avoidance strategies to emerge in response to the expanded tax base.
- Could face political opposition due to its focus on increasing taxes.
Most Disadvantaged Areas:
Constitutional Alignment
The bill's alignment with the Constitution is primarily rooted in the power of Congress to lay and collect taxes, as outlined in Article I, Section 8, Clause 1. The bill aims to "provide for the general Welfare of the United States," which is a stated purpose in the Preamble. The Sixteenth Amendment grants Congress the power to lay and collect taxes on incomes, from whatever source derived.
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).