Healthcare penalties hurt employees

Published 9:18 pm Wednesday, July 15, 2015

To the editor:

As a small business owner, my margins are tight. I have to keep prices low enough to keep my customers coming back. Hopefully, the economy will improve, but until then it just isn’t within the reach of our business to pay for costly group health insurance.

However, I used to help my employees pay for their own coverage by contributing a little more tax-free to their paychecks for the purpose of buying individual health insurance.

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But now, the IRS says that I can’t do this anymore. In fact, I could be fined $36,500 a year per employee if I make this contribution without taking all the taxes out of it. That’s crazy, since big companies only get fined $2,000 a year for not providing any health insurance at all.

Right now, I have no choice but to classify this as regular pay. That means my employees will have less money to help them pay for their insurance. There are bipartisan bills to fix this problem, S-1697 and HR-2911. I hope our congressmen and senators can rein in the IRS and get rid of these fines.

It’s tough enough to run a successful (let alone profitable) small business these days with all of the rules, regulations and taxes that we have to pay. Now, to be punitively punished for trying to help our own employees borders on the ridiculous.

It would be a refreshing change to see Congress (and especially the White House) actually do something good for small businesses. Please make this vital and important change now.

Keith Zinn

Virginia Beach