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Bill Would Halt New Tax Hike on Out of Pocket Medical Expenses

by Brandon Arnold / /


The Honorable Martha McSally
United States House of Representatives
510 Cannon House Office Building
Washington, DC 20515

Dear Representative McSally,

On behalf of the members of National Taxpayers Union (NTU), I write in support of H.R. 1051, your “Halt Tax Increases on the Middle Class and Seniors Act.” This legislation would prevent the implementation of a tax increase on out of pocket medical expenses that is scheduled to take place this year.

Under current law, taxpayers can deduct medical expenses which exceed 7.5 percent of their income for that year. However, under the Affordable Care Act (ACA) this threshold is scheduled to rise to 10 percent in 2017. This will have a disproportionate impact on the middle class and seniors, who are more likely to take advantage of this deduction.

This tax levy would be paid primarily by the middle class. In fact, the average family that claimed this deduction makes $53,000 a year. Seniors will also be disproportionately affected. According to The National Center for Policy Analysis, the average senior spends $4,888 a year on medical expenses, twice as much as the average non-elderly adult. The funds raised by this tax increase, $2 to3 billion annually, according to the Joint Tax Committee, are a small fraction of the federal budget, but will have an enormous impact on the budgets of American families who would save on average $200 to$400 a year if your bill becomes law.

Over 10 million taxpayers every year use this deduction to cushion the burden of medical expenses and this tax increase would cause an undue financial burden to seniors and those struggling with chronic medical conditions. NTU is pleased to endorse H.R. 1051and urges all Representatives to cosponsor this legislation, as well as continue to work toward the full repeal of the nearly $1 trillion ACA taxes.

Sincerely,
Brandon Arnold
Executive Vice President