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Academic Insights for the Thinking World
Sometimes it is gratifying to have predicted the future. Sometimes it is not. The recent postponement of the so-called “Cadillac tax” until 2020 falls into the latter category. I predicted this kind of outcome when the Cadillac tax was first enacted as part of the Affordable Care Act, popularly known as “Obamacare.” I am unhappy that events have now proven this prediction correct.
At President Obama’s urging, the US Department of Labor (DOL) has proposed a new regulation condoning state-sponsored private sector retirement programs. The proposed DOL regulation extends to such state-run programs principles already applicable to private employers’ payroll deduction IRA arrangements. If properly structured, payroll deduction IRA arrangements avoid coverage under the Employee Retirement Income Security Act of 1974 (ERISA) and the employers implementing such arrangements dodge status as ERISA sponsors and fiduciaries.
The Little Sisters of the Poor, an international congregation of Roman Catholic women, are unlikely litigants in the US Supreme Court. Consistent with their strong adherence to traditional Catholic doctrines, the Little Sisters oppose birth control. They are now in the Supreme Court because of that opposition.
S.B. 185, recently signed into law by California Governor Edmund G. (Jerry) Brown, Jr., requires California’s public employee pension plans to divest their investments in publicly-traded companies that derive half or more of their revenue from “the mining of thermal coal.”
Governor Andrew Cuomo says that he no longer wants New York to be “the tax capital of the nation.” The recent experience of Patrick J. Carr demonstrates the long distance New York must still travel to reach the governor’s goal.
John Oliver’s sardonic spoof of televangelists raises important issues that deserve more than comic treatment. Oliver’s satire was aimed both at the televangelists themselves and at the IRS. In Oliver’s narrative, the IRS acquiesces to televangelists’ abuse by granting their churches tax-exempt status and failing to audit these churches.
Medicare recently announced that it will pay for end-of-life counseling as a legitimate medical service. This announcement provoked little controversy. Several groups, including the National Right to Life Committee, expressed concern that such counseling could coerce elderly individuals to terminate medical treatment they want. However, Medicare’s statement was largely treated as uncontroversial—indeed, almost routine in nature.
The recent news about charitable contributions in the United States has been encouraging. The Giving Pledge, sponsored by Warren Buffett and Bill Gates, Jr., recently announced that another group of billionaires committed to leave a majority of their wealth to charity. Among these new Giving Pledgers are Judith Faulkner, founder of Epic Systems; Hamdi Ulukaya, founder of Chobani Yogurt; and Brad Keywell, a co-founder of Groupon.
In a letter addressed to President Obama, 26 members of the United States Senate expressed their support for the private sector retirement savings laws adopted in Illinois and California, and also being considered in other states. In particular, the senators asked that the United States Treasury and Labor Departments resolve three legal issues clouding the prospects of these adopted and proposed state laws.
The Obamacare “Cadillac tax” is currently scheduled to go into effect in 2018. However, last week, sixty-six members of the House of Representatives, including both Republicans and Democrats, proposed to repeal the Cadillac tax before it becomes effective. The Cadillac tax will be imposed at a 40% rate on the cost of health care insurance, exceeding statutorily-established thresholds. Unions and many of their Democratic stalwarts, otherwise supportive of Obamacare, oppose the Cadillac tax because generous union-sponsored health care plans will trigger the tax.
On one level, I admire the public furor now surrounding Indiana’s Religious Freedom Restoration Act (RFRA). In an important sense, this discussion reflects the Founder’s vision of a republican citizenry robustly debating the meaning of important values like nondiscrimination and religious freedom. On the other hand, this public controversy has, at times, regrettably reflected failure on both sides to respect their fellow citizens and confront the merits of the issue in civil fashion.
Tomorrow night’s appearance before a joint session of Congress by Israeli Prime Minister Benjamin (“Bibi”) Netanyahu raises four important questions, including the following: Should Speaker John Boehner have invited the Israeli Prime Minister to speak without first consulting with President Obama?
In his State of the Union address, President Obama proposed several tax increases aimed at affluent taxpayers. The President did not suggest one such increase which some Republicans might be persuaded to support: limit the estate tax deduction for bequests to private foundations.
The “lame duck” session of the 113th Congress managed to avoid a shutdown of the federal government, but did not accomplish much else. Among the unfinished business left for the new, 114th Congress assembling this month is the Marketplace Fairness Act (MFA). The MFA would permit states to require out-of-state Internet and mail order sellers […]
In Freedom From Religion Foundation, Inc. v. Lew, the US Court of Appeals for the Seventh Circuit recently dismissed a constitutional challenge to the parsonage allowance provisions of the Internal Revenue Code (Code). Under Section 107(2) of the Code, a “minister of the gospel” need not pay income taxes on the housing allowance received by the minister as part of his or her compensation.
There is a reason that Congress’s post-election meetings are called “lame duck” sessions. They often aren’t pretty. Senators and representatives not returning to Congress (because they retired or were defeated for re-election) may not have strong incentives to legislate responsibly. Senators and representatives who will be part of the new Congress starting in January may […]