“Small employers” who qualify for this 2010 income tax credit (including churches and section 501(C) (3) charitable organizations) must satisfy ALL of the following conditions:

One component of  the huge  healthcare legislation is a tax credit for small employers who pay at least 50% of their employees’ health insurance premiums. Unlike most of the future healthcare bill provisions, this employer federal tax credit can be claimed for year 2010 tax returns due this Spring.

Calculations for this new tax credit are very complex (even by tax law standards!) and are reported on new IRS Form 8941 – a one page tax form which requires completion of 7 different worksheets to accurately calculate the tax credit. You can review IRS Form 8941 with instructions at www.irs.gov.  IRS information and resources

Initially, the IRS outlined rules for the tax credit in Notice 2010-44. A follow-up document, Notice 2010-82, explained transition relief related to the rules for a qualifying arrangement and provided more details about the requirements. For example, Notice 2010-82 clarifies how an employer that offers more than one plan determines whether its contribution amount meets the threshold for a qualifying arrangement. The IRS has released several additional items related to the tax credit, including:

Three Simple Steps Fact Sheet |  Frequently Asked Questions |  YouTube Video |  More information is available on the IRS website

“Small employers” who qualify for this 2010 income tax credit (including churches and section 501(C) (3) charitable organizations) must satisfy ALL of the following conditions:

1)      You paid at least 50% of the “single employee” premium cost for year 2010. Insurance costs are for primary health insurance and dental and vision insurance. Employer contributions to HSAs, HRAs and FSA medical accounts are not deemed insurance and thus are not eligible for the tax credit; AND

2)      You employed fewer than 25 “full-time equivalent” (FTE) employees during 2010. In determining FTE employees, 30 employees who worked 20 hours per week count as 15 FTE employees. Employees who you exclude from this FTE “count” include:

• Owners of the employer and their relatives (parents, children, in-laws, aunts/uncles, etc);
• “Seasonal” employees who worked 120 or fewer days for you during 2010; AND

3)   Your “average annual wages” paid to employees during 2010 were less than $50,000 per FTE employee. For this purpose “wages” are gross wages paid before any tax or retirement withholdings.

IF YOU MEET ALL 3 OF THESE CONDITIONS, YOU LIKELY QUALIFY FOR THE TAX CREDIT.

How Much is the Tax Credit?

Small employers who pay at least 50% of their employees’ health insurance, have 10 or fewer full-time equivalent employees, with average annual wages of $25,000 or less per “FTE” employee, will receive a tax credit of 35% (25% for churches and 501(C) (3) charitable organizations) of the employer-paid health insurance premiums in 2010. This can be a large tax credit! HOWEVER, as the FTE employee count trends from 10 employees to 25, and the “average wages” per FTE employee trends from $25,000 to $50,000, the tax credit percentage decreases from the 35%/25% ”starting” tax credit rates.

CAN I “EYEBALL” IT?

Catalist has posted a “Short-Cut Small Employer Insurance Credit Percentage” worksheet as a downloadable form, CLICK HERE .  Note that the worksheet is divided unto 2 sections, For-Profit Business and Nonprofit Entity. A for-profit business with 14 “FTE” employees and with average 2010 wages per FTE employee of $35,000 would be eligible to claim a federal tax credit of 12% of the employer-paid health insurance premiums paid during 2010. If the employer paid $30,000 of health insurance premiums for their employees in 2010, their 2010 tax credit would be $3,600.

CLAIMING THE TAX CREDIT

So you have met all three of the eligibility requirements and have “eyeballed” our worksheet and estimated you can claim a tax credit of several thousand dollars. Now what?

You begin the process of completing IRS Form 8941, which for-profit employers will attach to their 2010 business income tax return, and churches and other 501 (C) (3) charities/ministries will complete and attach to non-profit IRS Form 990-T.

Since the Form 8941 calculations are confusing and lack substantial guidance from the IRS, we recommend that you be “pragmatic” and make your best effort to complete an accurate Form 8941 and claim the tax credit based on your calculations. “Close is good enough” in horseshoes and with Form 8941 calculations! If your calculations are later found to be slightly incorrect by the IRS, and you have made a “reasonable effort” to accurately prepare Form 8941, then you will be fine.

The calculations require that you capture 2010 payroll information for employee hours paid during 2010, and gross wages paid for 2010. Legal updates and tax considerations intended to inform clients and colleagues of Catalist about current payroll issues and planning techniques.  You should consult with your CPA or tax advisor before implementing any ideas, comments or planning techniques.  For a recommendations, Catalist recommends first consulting with Strategic Partner Profitable Accounting Services.

Catalist Financial has partnered with one of our Top Carriers to let the community know about some very important Insurance S0lutions for Breast Cancer Survivors.  Finding protection for your family should be the least of your challenges.

For more than 45 years, we’ve been providing protection for breast cancer survivors — and those who love them Massachusetts Mutual Life Insurance Company (MassMutual) has been proudly providing insurance coverage for breast cancer survivors since 1964. Today, thanks to the continuous evaluation of our underwriting guidelines, we believe more survivors than ever are qualifying for coverage with shorter waiting periods and lower premiums.

We work to ensure that the benefits of the most up-to-date diagnostic and treatment advancements are considered. As you take the next step in your journey, you can be assured that MassMutual will help you explore your various coverage options.
To learn more, contact a MassMutual financial professional at 317-441-4321

MassMutual’s insurance coverage can help provide the following “living benefits” for you and your family:
• Whole life insurance products (as long as the policy is in force) offer a guaranteed, cash value accumulation, which is tax-deferred and can be borrowed for any purpose. With supplemental retirement income, educational funding and a source of funds for emergencies, these products can offer comfort for you during your lifetime.1

• Term life insurance products offer death benefit coverage for a specified time frame and can provide policy owners with the ability to convert the policy during the conversion period to a permanent MassMutual policy, regardless of changes in the insured’s health.

• Disability income insurance benefits can help pay your mortgage or rent, medical bills and other expenses, if you are too sick and cannot work. A lengthy, chronic healthcare issue can affect so many parts of your life: from placing caregiving burdens on your family and potential asset depletion, to fulfilling your desire to live independently. A MassMutual professional will work with you and those closest to you to develop a strategy to address these concerns.

Protecting your family over the long term
Usual Medical Underwriting Requirements:
• Abbreviated medical examination (breast and gynecologic exams not required)
• Blood and urine studies
• Records from your physicians, to include:
• Pathology and surgery reports
• Records of any other treatment
• Follow-up visits and mammograms

For those currently in good health with no evidence of recurrent cancer, MassMutual uses the following general guidelines:

The above is a summary of MassMutual’s general underwriting guidelines. Because each person’s medical situation is unique, actual offers may vary depending on the specific factors involved.

Facing breast cancer is enough of a challenge without having to worry about how your family will be protected if something happens to you. At this time, there are about 2.5 million breast cancer survivors in the United States. Thanks to early detection and improved treatment options, that number is rising every day and more women are surviving breast cancer than ever before.*

You deserve a team of professionals who understand the challenges you face, and can provide options to help you make good decisions for yourself and for your family.

Take care of yourself, and protect those who love you, too.

Insurance products issued by Massachusetts Mutual Life Insurance Company, Springfield, MA 01111-0001.  Some products and riders may not be available for sale in all states, and may have exclusions and limitations. For costs and complete details of coverage call your agent or MassMutual at 317-441-4321 for your local agent.

© 2009 Massachusetts Mutual Life Insurance Company, Springfield, MA.
All rights reserved. www.massmutual.com. MassMutual Financial Group is a marketing name for Massachusetts Mutual Life Insurance Company (MassMutual) and its affiliated companies and sales representatives.

* Source: American Cancer Society, Detailed guide: Breast Cancer www.cancer.org, updated May 2009

1 Distributions under a policy (including cash dividends, withdrawals and partial/full surrenders) are not subject to taxation up to the amount paid into the policy (the cost basis). If the policy is a Modified Endowment Contract, policy loans and/or distributions are taxable to the extent of gain and are subject to a 10% tax penalty.

Access to cash values through borrowing, withdrawals or partial surrenders can reduce the policy’s cash value and death benefit, increase the chance the policy will lapse, and may result in a tax liability if the policy terminates before the death of the insured.
WMI1292 909
CRN201109-124568

Under the Patient Protection and Affordable Care Act (or health care reform law), the secretary of Health and Human Services will establish a voluntary long-term care (LTC) insurance program called Community Living Assistance Services and Supports (CLASS) by January 1, 2011. The program will offer the CLASS Independence Benefit Plan, but the new law does not specify a date for enrollment. This is a government program.

What the provision does

The long-term care provision of health care reform law is designed to help individuals and families pay for long-term care. Fewer than 10% of older Americans currently have private LTC coverage. The CLASS program attempts to address gaps in coverage by offering a long-term care insurance plan. However, it offers limited benefits.

Who can enroll

Employers will need to decide if they will offer the CLASS program to employees. If an employer chooses to participate, employees age 18 and older must be automatically enrolled in the program, regardless of their pre-existing conditions. Employees can choose to “opt-out” if they don’t want to participate. CLASS is also available to individuals who are self-employed, have more than one employer or have an employer who chooses not to participate.

How the premiums will be determined

Premiums will be established by the U.S. Department of Health and Human Services secretary and will be based on age and not health risk. Based on the information available, we believe premium subsidies will be available for workers with incomes below the federal poverty level and full-time students age 18 to 21 who work.

How to qualify for benefits

After paying premiums for five years, enrollees will be eligible to receive benefits.CLASS will be administered by the U.S. Department of Health and Human Services

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This content is provided solely for informational purposes. It is not intended as and does not constitute legal advice. The information contained herein should not be relied upon or used as a substitute for consultation with legal, accounting, tax and/or other professional advisers.

People buy life insurance for the death benefit to help replace income and cover daily expenses. Life insurance can also help protect your financial future with a death benefit you can use for:

• Mortgage payments
• College tuition
• Child care
• Everyday expenses

With many life insurance products available, you can tailor your policy for a living benefit in case of an unexpected illness, or to supplement retirement income with a cash value accumulation product. (note: cash value accumulation Life Insurance products only work for a small portion of the population as part of an overall strategic financial plan, contact your CATALIST ADVISOR to see which Life Insurance products are best for you)

Nearly four in five families in the U.S. are protected … ARE YOU

Individual Life Insurance can serve many different purposes, depending on what your needs are.  Life Insurance is really “Death Insurance” and the most common type of Life insurance is TERM INSURANCE.  This is typically purchased to cover debts and fund other planned items for the insureds family in the event of an un-timely death. To figure out how much TERM life insurance you need CLICK HERE

Once you have determined your need, you should talk to a Licensed Insurance Broker who is able to Shop MULTIPLE CARRIERS and get you the best price monthly premium for your desired death benefit. You may run a few quotes by CLICKING HERE on your own, however to ensure the most competitive rates, let our brokers scour the market for you, just look at all the companies we can research for you:

OUR BROKERS WILL SCOUR & CHECK ALL OF THE FOLLOWING CARRIERS FOR THE BEST PRICING & HELP YOU DETERMINE THE RIGHT NEED:

When are these changes effective?
The 2010 Medicare Supplement changes will be effective on any policy sold effective June 1, 2010.

When can I start marketing the new plans?
The new plans are effective June 1, 2010, so the kickoff for selling to those clients who will turn 65 in June will actually be January 1, 2010.

How competitive will the new plans M & N be?
We expect them to be very competitive. Co-Pays and Co-Insurance will always drop the premium.

Why were plans E, H, I and J eliminated?
Plan E was eliminated because the new Plan D would contain exactly the same benefits. Plans H, I and J were eliminated because with the other dropped benefits these plans would also duplicate other plans available.

What will happen in the plan your client has is dropped?
Any plan that was purchased prior to June 2010 will remain inforce. Keep in mind these new plans are for new issues with effective dates of June 2010 and beyond. Your clients’ current Medigap plan is guaranteed renewable for life. Even if their health changes, they cannot be terminated or forced to change to one of the new plans.

What is the new hospice benefit?
All plans will now include the Hospice Benefit as part of the “Core Benefits.” Medicare provides coverage for inpatient respite care up to 5 days less a co-payment amount of 5% of the daily benefit. The new Hospice benefit will pick up this 5% co-pay.

Why was the At-Home Recovery benefit dropped?
It was determined that the benefit was confusing and difficult to understand and administer.

Why was Preventive Care dropped from all plans?
Because Medicare Part B has changed to cover many more preventive benefits, effectively rendering this benefit redundant.

For Personal Advice or to talk to a Customer Care Consultant call 1-866-460-4321 or to e-mail us click here.

New Hospice Benefit
All plans will now include the Hospice Benefit as part of the “Core Benefits.” Medicare pays for all but very limited co-payments for outpatient drugs ($5). Included in all Medigap plans a benefit to pay this co-payment will be included.

Medicare provides coverage for inpatient respite care up to 5 days less a co-payment amount of 5% of the daily benefit. The new Hospice benefit will pick up this 5% co-pay.

New Plans
The new regulation also makes the following two new plan options available to beneficiaries, which have higher cost–sharing responsibilities and lower estimated premiums:

• New Plan M includes 50 percent coverage of the Medicare Part A deductible and does not cover the Medicare Part B Deductible. Plan M has all the core benefits plus the foreign Travel Emergency Benefit.
• New Plan N does not cover the Medicare Part B deductible and adds a new co–payment structure of $10 for each physician visit and $50 for each emergency room visit (waived upon admission to the hospital). Plan N has all the core benefits plus the foreign Travel Emergency Benefit.

Benefit Chart of Medicare Supplement Plans Sold for Effective Dates on or After June 1, 2010

*Plan F also has an option called a high deductible plan F. This high deductible plan pays the same benefits as Plan F after one has paid a calendar year [$1900] deductible. Benefits from high deductible plan F will not begin until out-of-pocket expenses exceed [$1900]. Out-of-pocket expenses for this deductible are expenses that would ordinarily be paid by the policy. These expenses include the Medicare deductibles for Part A and Part B, but do not include the plan’s separate foreign travel emergency deductible.

For help understanding how this may impact your Medicare Plans or Health Care costs, please contact a representative at CATALIST HEALTH by calling – 1 – 866 – 460 – 4321 or by e-mailing info@catalistfinancial.com