Obamacare enrollees who received subsidies to help pay for coverage will soon have to reconcile how much they actually earned in 2014 with how much they estimated when they applied many, many months ago.

This will likely lead to some very unhappy Americans. Those who underestimated their income either will receive smaller tax refunds or will owe the IRS money.

That’s because subsidies are actually tax credits and are based on annual income, but folks got their 2014 subsidy before knowing exactly what they’d make in 2014. So you’ll have to reconcile the two with the IRS during the upcoming tax filing season.

It won’t be surprising if many enrollees guessed wrong. The sign up period began in October 2013 and many people did not know what they’d earn in 2014. Some went off what they earned in 2012.
Also, it was up to consumers to report major changes in their circumstances, such as landing a new job or getting married, so their subsidy amounts could be recalculated.

Related: Obamacare premiums: Going up unless you shop
We’re not talking chump change. Those who applied through the federal exchange received an average monthly subsidy of $264, according to the most recent figures reported by the Obama administration. They only had to pay $82 a month, on average, for coverage, Roughly 85% of total enrollees received help with insurance premiums. The administration last month said 2014 enrollment was 6.7 million.

Those who underestimated their earnings could owe thousands of dollars, though there is a $2,500 cap for those who remain eligible for subsidies. The threshold for eligibility is based on income – $45,900 for an individual and $94,200 for a family in 2014.

Of course, those who overestimated their 2014 income may get a healthier-than-expected refund. And some will see no change.

Here’s what happens next:
Obamacare enrollees should receive Form 1095-A from their exchange by Jan 31. It lists who in the household had policies and how much they received in monthly subsidies.
Taxpayers will then use that documentation to fill out Form 8962, which asks details on insurance, subsidies and income. If they were not covered for the entire year, they have to break down the subsidy payments by month.

READ MUCH MORE:

Well, Obamacare is now official, which means that a lot more people in the United States will have health insurance.

And it also means a lot more people will be paying more taxes.

(You didn’t think Obamacare was free, did you?)

Here are some of the new taxes you’re going to have to pay to pay for Obamacare:

A 3.8% surtax on “investment income” when your adjusted gross income is more than $200,000 ($250,000 for joint-filers). What is “investment income?” Dividends, interest, rent, capital gains, annuities, house sales, partnerships, etc. Taxes on dividends will rise from 15% to 18.8%–if Congress extends the Bush tax cuts. If Congress does not extend the Bush tax cuts, taxes on dividends will rise from 15% to a shocking 43.8%. (WSJ)
A 0.9% surtax on Medicare taxes for those making $200,000 or more ($250,000 joint). You already pay Medicare tax of 1.45%, and your employer pays another 1.45% for you (unless you’re self-employed, in which case you pay the whole 2.9% yourself). Next year, your Medicare bill will be 2.35%. (WSJ)
Flexible Spending Account contributions will be capped at $2,500. Currently, there is no tax-related limit on how much you can set aside pre-tax to pay for medical expenses. Next year, there will be. If you have been socking away, say, $10,000 in your FSA to pay medical bills, you’ll have to cut that to $2,500. (ATR.org)
The itemized-deduction hurdle for medical expenses is going up to 10% of adjusted gross income. Right now, any medical expenses over 7.5% of AGI are deductible. Next year, that hurdle will be 10%. (ATR.org)
The penalty on non-medical withdrawals from Healthcare Savings Accounts is now 20% instead of 10%. That’s twice the penalty that applies to annuities, IRAs, and other tax-free vehicles. (ATR.org)
A tax of 10% on indoor tanning services. This has been in place for two years, since the summer of 2010. (ATR.org)
A 40% tax on “Cadillac Health Care Plans” starting in 2018.Those whose employers pay for all or most of comprehensive healthcare plans (costing $10,200 for an individual or $27,500 for families) will have to pay a 40% tax on the amount their employer pays. The 2018 start date is said to have been a gift to unions, which often have comprehensive plans. (ATR.org)
A”Medicine Cabinet Tax” that eliminates the ability to pay for over-the-counter medicines from a pre-tax Flexible Spending Account. This started in January 2011. (ATR.org)
A “penalty” tax for those who don’t buy health insurance. This will phase in from 2014-2016. It will range from $695 per person to about $4,700 per person, depending on your income. (More details here.)
A tax on medical devices costing more than $100. Starting in 2013, medical device manufacturers will have to pay a 2.3% excise tax on medical equipment. This is expected to raise the cost of medical procedures. (Breitbart.com)
So those are some of the new taxes you’ll be paying that will help pay for Obamacare.

Any big ones I’ve missed?

Note that these taxes are both “progressive” (aimed at rich people) and “regressive” (aimed at the middle class and poor people). The big ones–the 3.8% investment income hike and the Medicare tax increase–only hit you if you’re making more than $200,000 a year. The rest hit you no matter how much you’re making.

READ MORE:

Many Americans are furious that Obamacare will require them to buy health insurance.

Most of these folks seem to hate the idea that Obama is forcing them to do something more than they hate the idea of shelling out money.

But for those who also care about the money, here are the details.

The good news is that, for most people, the “penalty tax” for those who choose not to buy health insurance will cost a lot less than health insurance.

As with everything tax-related, there’s no simple answer to “How much is the Obamacare penalty tax?” But here are some key points, from FactCheck.org:

The penalty/tax will be phased in from 2014 to 2016.
The minimum penalty/tax in 2016 will be $695 per person and up to 3-times that per family. After 2016, these amounts will increase at the rate of inflation.
The minimum penalty/tax per person will start at $95 in 2014 (and then increase through 2016)
No family will ever pay more than 3X the per-person penalty, regardless of how many people are in the family.
The $695 per-person penalty is only for those who make between $9,500 and ~$37,000 per year. If you make less than ~$9.500, you’re exempt. If you make more than ~$37,000, your penalty is calculated by the following formula…
The penalty is 2.5% of any household income above the level at which you are required to file a tax return. That level is currently $9,500 per person and $19,000 per couple. The penalty on any income above that is 2.5%. So the penalty can get expensive quickly if you make a lot of money.
However, the penalty can never be more than the cost of a “Bronze” heath insurance plan purchased through one of the state “exchanges” that will be created as part of Obamacare. The CBO estimates that these policies will cost $4,500-$5,000 per person and $12,000-$12,500 per family in 2016, with the costs rising thereafter.
So, basically, you’re looking at penalties of approximately the following at the following income levels:

Less than $9,500 income = $0
$9,500 – $37,000 income = $695
$50,000 income = $1,000
$75,000 income = $1,600
$100,000 income = $2,250
$125,000 income = $2,900
$150,000 income = $3,500
$175,000 income = $4,100
$200,000 income = $4,700
Over $200,000 = The cost of a “bronze” health-insurance plan
The IRS will collect the penalty-tax, a fact that will no doubt further enrage those who hate Obamacare.

But here’s some more good news for those folks:

The IRS will not have the power to charge you criminally or seize your assets if you refuse to pay. The IRS will only have the ability to sue you. And the most the IRS can collect from you if it wins the suit is 2X the amount you owe. So if you want to thumb your nose at the penalty-tax, the IRS won’t be able to do as much to you as they could if you refused to pay, say, income tax.

By the way, the following folks will be exempt from the penalty-tax:

Those who make less than $9,500
Employees whose employers only offer plans that cost more than 8% of the employee’s income
Those with “hardships”
Members of Indian tribes
Members of certain religions that don’t pay Social Security tax, such as Amish, Hutterites, or Mennonites
And, of course, Obamacare isn’t free. So, whether you pay the penalty or not, you’re going to have to pay a lot of other taxes to pay for it.

Read More

The FCC will take up Chairman Tom Wheeler’s new Net regulatory approach Feb. 26 — and then AT&T (T +0.3%) and Verizon (VZ) will immediately file suit, VentureBeat reports.

The site points to AT&T VP Hank Hultquist’s Monday post on the company’s public policy blog, where he argues again that its broadband is an info service, not a telecom service — although this is a familiar stance on the company’s blogs.

“I have no illusions that any of this will change what happens on Feb. 26,” Hultquist says. “But when the FCC has to defend reclassification before an appellate court, it will have to grapple with these and other arguments.

FCC fact sheet

Previously: Telecom stocks soar as FCC’s Wheeler advocates utility stance on regulation (Feb. 04 2015)

Previously: More from FCC’s Wheeler: Guarantees to encourage broadband investment (Feb. 04 2015)

FIND LINKS TO ALL THESE HERE

You should believe Verizon Communications CEO Lowell McAdam when he says he intends to end wired telephone and broadband service for areas that are simply not economically feasible for fiber upgrades. McAdam’s grand plan is now coming true for customers in parts of Florida and on Fire Island, N.Y.

Last summer, Stop the Cap! covered McAdam’s comments to Wall Street investors (that are always the first to know) at the Guggenheim Securities Symposium:

“In […] areas that are more rural and more sparsely populated, we have got [a wireless 4G] LTE build that will handle all of those services and so we are going to cut the copper off there,” McAdam said. “We are going to do it over wireless. So I am going to be really shrinking the amount of copper we have out there and then I can focus the investment on that to improve the performance of it.”

The writing is already on the wall:

Verizon has been penalized and criticized in several states by public utility commissions for the ongoing degradation of its copper network. Verizon sees further investment in copper technology as throwing good money after bad, but spending millions on additional fiber upgrades isn’t appealing either. The result is deteriorating service. From downtown Manhattan to New Jersey to Maryland, D.C. and Virginia, Verizon’s service failures have left customers frustrated and sometimes waiting weeks or months for repair crews to turn up to restore basic phone service. Even more dangerous, Verizon was to blame for significant 911 network failures near the nation’s capital. Post Sandy, there are still sections of lower Manhattan without phone service nearly five months after the storm struck. Five months.

Verizon sold off telephone service in northern New England several years ago to FairPoint Communications, knowing full well Verizon never had an interest in upgrading any part of Vermont, New Hampshire or Maine to fiber service. In many smaller former GTE telephone areas too small to successfully argue a case for return on investment, Verizon decided selling those territories off was the best option. Hawaiian Telcom and Frontier Communications now own many of those former-Verizon territories.
Verizon has decreased marketing its wired DSL service and stopped selling it altogether to customers who want broadband-only service. That seems counter-intuitive for a company that recognizes future revenue possibilities come primarily from broadband and data services.

Traditionally, customers reporting trouble on a phone line get a visit from Verizon technicians who track the problem down and repair it. But Verizon no longer wants to spend money fixing copper wire-related problems. Customers reporting chronic phone static or outages are now being asked to abandon their traditional landline service instead:

In areas where Verizon FiOS fiber is available, the company disconnects the customer from copper service and switches them to the FiOS fiber network. This also provides future marketing opportunities, pitching broadband and television service to accompany a customer’s home phone.
In areas where fiber upgrades are not forthcoming, the company now proposes to disconnect the customer in favor of Voice Link, a wireless home phone replacement. This also opens marketing opportunities for Verizon Wireless to pitch cell phones and wireless Internet service.

READ MORE

Net neutrality’ rules discard bipartisan light-touch regulatory framework.
Thursday marked the largest government intervention into the Internet ecosphere in American history. By equating the dynamic 21st century Internet to the telephone system of 1934, the Federal Communications Commission has thrust powerful but antiquated utility-style regulations onto the U.S. tech economy.

To justify its actions, the FCC had to resort to misleading distortions that essentially asserted “the Internet is so horribly broken that only the government can fix it.” And “you can trust unelected Washington bureaucrats to do a better job of running the highly complex Net than engineers, entrepreneurs and consumers.”

The FCC’s power grab discards the bipartisan light-touch regulatory framework laid out during the Clinton administration. That hands-off approach made the Net the greatest deregulatory success story of all time.

History teaches us that utility-style regulation raises costs to consumers, reduces investment and innovation, and creates uncertainty due to the politics-driven nature of “mother may I innovate” government mandates. Regulation only grows. Now the Internet cannot escape that fate.

The ultimate result of more government encroachment will be something akin to the sagging European Internet market, where investment in broadband infrastructure is only one-fourth of America’s due to heavy-handed regulations. Even worse, this new power grab could trigger expanded intergovernmental powers over the Web through existing telecom treaties, jeopardizing Internet freedom.

What many in Silicon Valley don’t understand is that, according to the Supreme Court’s 2005 Brand X decision, nearly any “tech” company that builds a telecom-style network to deliver its content and apps has the potential to be captured by the FCC’s new rules. If the agency tries to exempt some companies but not others, it will be choosing the politically favored over everyone else.

As the effects of these new rules gradually slow the lightning-fast evolution of the Net, it is likely to be overturned by courts, Congress or both. In the meantime, America’s Internet consumers will be caught in the crossfire.

Robert McDowell, who served on the FCC from 2006 to 2013, is a partner at Wiley Rein.
ORIGINAL

Three New York City residents — two with Uzbekistan citizenship, and one a citizen of Kazakhstan — plotted to travel to Syria to join ISIS militants and ‘wage jihad,’ the Justice Department announced on Wednesday. 

One of the defendants also offered to kill the president of the United States if ordered to do so, the criminal complaint alleged. 

The men were identified in the complaint as Abdurasul Hasanovich Juraboev,  24, a resident of Brooklyn and a citizen of Uzbekistan; Akhror Saidakhmetov, 19, a resident of Brooklyn and a citizen of Kazakhstan; and Abror Habibov, 30, a resident of Brooklyn and a citizen of Uzbekistan.

Federal prosecutors say two of the men came to the attention of law enforcement last summer after they expressed online support for the groups.

Saidakhmetov was arrested early Wednesday at John F. Kennedy International Airport as he tried to board a plane headed to Istanbul, authorities said. Juraboev had plane tickets for March 29 and Habibov helped fund Saidakhmetov’s trip, the complaint said.

The two had hopes of joining the terror group and–if their travel plans were dashed– had intentions to commit terror in the U.S., the complaint said. Juraboev allegedly offered to kill the president if given the orders from ISIS. Saidakhmetov–if prevented from joining the terror group– wanted to purchase a machine gun and shoot law enforcement, the complaint said.

via 3 arrested in New York City for allegedly conspiring to support ISIS | Fox News.

For a while now, Miley Cyrus has been inching closer to pornography with her increasingly revealing outfits and scandalous dance moves. Now she’s going to appear in an actual pornography festival.

Cyrus’s short film, “Tongue Tied” — which depicts the almost-nude “Wrecking Ball” singer in bondage gear and sexually suggestive poses — will appear in the NYC Porn Film Festival, which begins in Bushwick on Feb. 27.

It’s not pure pornography — the video has no sex, and though she writhes around in her underwear, she keeps her nipples covered. But it’s full of bondage imagery: Cyrus dons a blindfold, has her legs constrained by straps and is tied to a chair with only black tape covering her nipples. It’s a touch “Fifty Shades” with a pinch of Madonna’s “Justify My Love” video.

“It’s a pop take on S&M,” festival founder Simon Leahy says. “She’s starting to become more of a contemporary artist.”

The video was released online in May, and Cyrus used it during her shows on her Bangerz Tour last year. Leahy says they contacted Cadence, the production company that made the film with director Quentin Jones. Leahy asked Cadence if he could include it in the festival. While she likely won’t be at the festival personally, Cyrus is no stranger to Bushwick: She was spotted — topless and twerking — at a secret Alexander Wang warehouse party in the neighborhood in September.

The NYC Porn Film Festival is sponsored by the free video site PornHub, and runs Feb. 27 through March 1 at Secret Project Robot, featuring amateur and professional work from international filmmakers

via Miley Cyrus to appear in porn film festival | New York Post.

The recent suspension of Brian Williams and spotlight on news personalities has caused a shake-up at MSNBC. The Daily Beast is reporting that the Rev. Al Sharpton may lose his nightly time slot. His show, “Politics Nation with Al Sharpton,” has been on the air since 2011 and has had a successful run. At issue is a steady slide in viewership that will cause news correspondent Chris Hayes to be replaced by the “Rachel Maddow Show.” Maddow’s show will move from its current 9 p.m. slot to 8 p.m., while a search is underway for a new host for the 9 p.m. time slot left by Maddow.

It is rumored that Sharpton’s show will move from its nightly 6 p.m. time slot to a weekend only show. Sharpton attracts a solid 35 percent Black audience and is considered a lightning rod of controversy because of his activism on behalf of the oppressed. The source at MSNBC stated it was also part of a change in the political mindset of the programming stating, “Going left was a brilliant strategy while it lasted, and made hundreds of millions of dollars for Comcast, but now it doesn’t work anymore…The goal is to move away from left-wing TV.”

There has been no word from the Sharpton camp on the rumored changes at MSNBC.

via MSNBC shake up: Al Sharpton to lose nightly show.

President Obama defended the “true peaceful nature of Islam” on Wednesday — saying terrorist groups like ISIS promote a “twisted interpretation of religion that is rejected by the overwhelming majority of the world’s Muslims.”

In an op-ed published in the Los Angeles Times, the commander-in-chief provided a possible preview of a speech later at a White House Summit on Countering Violent Extremism, in which community leaders from across the country gathered to discuss how to protect people from “extremist ideologies.”

“The world must continue to lift up the voices of Muslim clerics and scholars who teach the true peaceful nature of Islam,” Obama wrote.

“We can echo the testimonies of former extremists who know how terrorists betray Islam. We can help Muslim entrepreneurs and youths work with the private sector to develop social media tools to counter extremist narratives on the Internet.”

“This week, we’ll be joined by people of many faiths, including Muslim Americans who make extraordinary contributions to our country every day,” he added.

“It’s a reminder that America is successful because we welcome people of all faiths and backgrounds.”

The president once again refused to utter phrases such as “Islamic terrorism” or “Islamic extremist” — instead referring to ISIS militants as “individuals from various religions” who practice “hateful ideologies.”

via Obama defends the ‘true peaceful nature of Islam’ | New York Post.

Verizon (NYSE: VZ) is close to reaching a deal to sell $10 billion in wireline assets to Frontier Communications, reports Reuters, citing a person familiar with the talks.

News of a potential deal follows reports that Verizon would sell a package of assets, including its wireless towers and elements of its wireline business for about $15 billion.

There also was a rumor circulating that Verizon would sell its fiber networks in Florida, Texas and California, but that particular package was valued at only $5 billion.

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Although neither service provider has specified any details of a deal, Verizon could use the proceeds to fund its recent $10.4 billion purchase of AWS-3 wireless spectrum in the FCC’s Auction 97.

Frontier has been expanding its territory through targeted acquisitions over the past five years.

This would not be the only time Frontier and Verizon have conducted a wireline deal. In 2009, Verizon sold off its unwanted rural wireline assets in 14 states to Frontier for $6.8 billion. Later, Frontier purchased AT&T’s Connecticut wireline operations for $2 billion last October.

However compelling a potential sale could be for Frontier in terms of scaling the geographic reach of its business, Macquarie Research said in a report that it is concerned about the quality of the assets it would buying.

“We are surprised that FTR’s Board would approve such a big, binary bet on declining assets with cable competition set to strengthen with pending Comcast and Charter deals,” wrote Macquarie in a research report.

Verizon would not provide a comment to Reuters and Frontier did not respond to FierceTelecom.

News of a potential wireline asset sale emerged in January when Verizon’s CEO Lowell McAdam told investors during the Citi 2015 Global Internet, Media & Telecommunications Conference that “there are certain assets on the wireline side that we think would be better off in somebody else’s hands so we can focus our energy in a little bit more narrow geography.”

In related news, AT&T (NYSE: T) is also close to selling off $2 billion of its data center assets, but no particular deal has been struck yet.  

via Report: Verizon to sell $10B in wireline assets to Frontier – FierceTelecom.