New To Us, News To You : New To Us, News To You

Friday, May 29, 2009

Powerball

On May 28^th, 29 of the top 100 searches on Google were for Powerball or various state lottery sites. That’s almost 1/3 of their top searches! I guess it is understandable since the Powerball jackpot was $232 million for the May 27^th drawing.

As the saying goes "you have to play to win". I would venture to guess the winner from Winner, SD (no joking!) was thrilled that they played and won (the best part!). Four others across the United States won $1 million by matching 5 numbers (and adding the Power Play option). Once again, they played and they won.

Getting back to my point for this week, you have to play to win. There are so many times in life where this saying holds true, childhood games, dating, marriage, business, and for some, the Powerball. How many times have you said, "Give it a try. You’ll never know until you try"? Basically the same principal as you have to play to win. You would have never found your interests or skills as a child if you never tried anything new. And how would you have met that special someone in your life if you never took the chance to "play" the dating game?

Don’t you "play" in your business hoping for a win? Giving great customer service, weekly specials, coupons or various other gambles trying for the play that will make your business a winner. Every customer coming in your business counts as a win. Of course this concept isn’t new to anyone in business.

Another way to play to win is to take advantage of what’s out there. Get the rebates, tax credits and deductions you deserve for your business. Search the Internet and do your homework. Talk to your tax professional or financial planner. Do a little extra work to save more dollars. Try the HRA. You could "play" and save an average of $3800 a year. The odds with an HRA are definitely better than the Powerball!

Good luck and remember "you have to play to win"!

Laura Radebaugh

BASE Administration/Adjudication Specialist

Posted By Laura Radebaugh At 1:53 PM •

Friday, May 22, 2009

Deduct some more!

I have noticed lately that in many of the conversations we have with potential clients about an HRA, they have a tendency to respond with “I already deduct my health care expenses from my taxes”.

First of all – they probably do already deduct their health care insurance premiums from their personal income tax. For example, if you are paying $950 per month for a comprehensive family health plan, you can deduct all of those premium dollars from your personal income tax. If you are in a 15% tax bracket, you are going to save $1,710 annually by deducting your premiums from your personal taxes. Well Done!

There are two key difference to be taken into consideration with an HRA. Through an HRA these expenses are not taken as a personal deduction, they are taken as a BUSINESS deduction.

The differences?

#1 – Additional savings: by taking the deductions on the business tax return you will be saving self-employment tax dollars on the funds spent for insurance premiums, an additional 15.3% to be exact. You save $1,710 in federal taxes + $1,744 saved in self-employment taxes.

#2 – With an HRA in place, we generally add the additional expenditures that a family has each year for out-of-pocket medical costs. As an annual AVERAGE in the US, families are spending $6,800 in out-of-pocket medical expenses. Out-of-pocket includes dental, eye care, allergy relief and hundreds of other qualifying expenses. Wouldn’t you enjoy saving 30.3% (federal tax + self-employment tax) on these expenses?

$1,720 - saved on federal taxes on premiums
$1,744 - saved on self-employment taxes for premiums
$2,060 - saved on self-employment and federal taxes for out-of-pocket expenses

Okay – so granted, they WERE deducting their health insurance premiums and maybe some out-of-pocket expenses (only if those expenses totaled more than 7.5% of their adjusted gross income on their Schedule A) from their personal taxes – good plan. But in this day and age, not good enough.

I’ll take my $5,524 in savings over their $1,710 any day.

Oh – and I haven’t calculated in anywhere the fact that I am ALSO still saving my state taxes on my premium dollars and my out-of-pocket expenses – but I don’t need to rub it in, you get my drift, right?

It’s your money, I would suggest you do everything you can to hang on to it!

- Nina Lorimor-Easley
BASE Marketing

Posted By Nina Easley At 3:25 PM •

Friday, May 08, 2009

Answer Found in Cafeteria Plans

Did you know that 47 Million Americans are uninsured? Nobody really thinks about how many people they might know that are walking around uninsured, and someday unexpectedly could wake up with a large amount of medical bills. Most often leaving these individuals with a great amount of debt.

The cost of health care continues to rise at an alarming rate, and the government is working to find the best way to provide universal health care coverage. With most states experiencing shrinking budgets, reforming our health care system has become more of a daunting task.

Lawmakers continue to push on with national discussion of comprehensive reform, so many employers are finding themselves at the mercy of the state in which they live. That isn’t saying much, seeing as though most states are finding themselves scrambling to find a solution for increasing health challenges while funds continue to decrease for all health programs amidst a turbulent economy.

Now many states are taking charge of their own fate by implementing new strategies to take health care by the horns and are finding a solution in cost containment programs. This is why roughly a third of the 50 states have adopted some form of state mandated, tax free, cafeteria plans.

Today cafeteria plans happen to be the saving grace for states facing competing demands for people without health insurance coverage, investing in prevention and wellness, along with adopting the latest technology in exchangeable electronic medical records.

This leaves me wondering if we will ever see a major transformation in health care. However, there are a lot of options that are available to individuals seeking methods to assist them with their medical costs. Leaving me with one burning question for lawmakers mandating the use of cost containment programs, like cafeteria plans: Do the people that need to take advantage, of something that is meant to help them with increasing health care expenses, even know or understand how it is suppose to benefit them?

Anne Case - BASE Marketing

Posted By Anne Case At 7:00 AM •

Monday, May 04, 2009

Swine Flu

H1N1 Influenza Virus, as we are now told to call the virus, was originally named “Swine Flu”. How can a name cause such a problem? It has almost had more publicity than the virus itself. The poor hogs of the world are taking the heat for something they only contributed a small portion to. Don’t get me wrong, I’m not going to kiss a pig but I’m also not afraid to be near one. Maybe that’s because I live in Iowa.

It is a little unnerving to think that a flu virus could take a generally healthy young adult and put them close to death, or in some cases it actually killed them. My husband was sick over the weekend and it didn’t seem to be just a cold. After seeing our doctor, it was only walking pneumonia (maybe I shouldn’t say ONLY!). I didn’t believe it was the H1N1 virus but, we do leave May 3rd on vacation and he wasn’t going if he was sick!

The number of cases and deaths will determine the impact the H1N1 virus will have on the economy. If healthy working adults make up a big part of the confirmed deaths and the number of affected people, the economy will start hurting more than it is now.

People will be afraid to travel, shop, go to restaurants, and generally stay home and away from public as much as possible hoping not to be infected. On the flip side of that coin, if unemployed people are staying at home for a couple of weeks, that has a smaller economic impact than if they were all at work and had to take sick time. And if people were already going out less to restaurants, to do shopping and traveling, the fall in consumption due to flu might be smaller than it would have been too.

Any pandemic that might kill millions of working age adults would have a huge impact on the long-term economy, even if they were out of work when they died. Let’s hope we don’t have to deal with that.

Just a couple of tips to stay healthy:

Wash your hands often with soap

Cover your mouth and nose when you cough or sneeze

Use hand sanitizer when possible (it does kill germs!)

Eat healthy and get plenty of sleep

Stay healthy and don’t forget about utilizing your HRA for medical expenses if you do fall ill.

Laura Radebaugh
BASE Administration/Adjudication Specialist

Posted By Nina Easley At 8:47 AM •