On June 22, 2017, the Senate released its long-anticipated Obamacare replacement bill. It is titled the “Better Care Reconciliation Act of 2017.” Republican leadership in the Senate has tabled the vote on this bill until after the July 4^th recess. Here at Surgent, we continually monitor this and other relevant legislative happenings so as to keep you up to date. Check back here for the latest.

Here’s more on this bill:

Notably, the bill seeks to repeal the 3.8 percent net investment income tax. The repeal would take effect for tax year 2017 forward. If passed, tax professionals would be well advised to discuss with their clients the savings potentially in store come April, 2018.

The bill also would repeal to the start of 2016 the Obamacare provision mandating that most Americans maintain health insurance or face a fine. As expected, the bill would repeal, also to the beginning of 2016, the employer mandate that large employers provide health coverage or face a fine. For those advisors with employers as clients, there will be ample opportunity for planning in terms of potential cost reduction with an eye toward continued employee goodwill.

The bill also seeks to decrease the maximum household income level for federal premium subsidies which reduce the cost of individual plans. Currently, the maximum is set at 400 percent of the federal poverty level. The bill would reduce the applicable figure to 350 percent of the poverty level. The bill does continue for at least two years the reimbursements to health insurance companies for subsidies to low income customers.

The bill also repeals the 0.9% additional Medicare tax beginning in 2023; the exclusion from “qualified medical expenses” of over-the-counter medications for HSAs, Archer MSAs, Health FSAs and HRAs beginning in 2017; and the higher floor for medical deductions so that the 7.5% floor returns in 2017.

Also, the bill increases contribution limits for HSAs beginning in 2018 and repeals the “Cadillac” tax on high cost employer plans beginning in 2020, but it returns in 2026.

Medicaid takes quite a profound hit under the proposed bill. The government shares the cost of Medicaid with individual states, and the federal portion will fall to approximately 57 percent over the course of seven years. In contrast, the government now guarantees at least 90 percent of the costs of newly Medicaid eligible adults made eligible under the Affordable Care Act.

The bill also suspends federal funding to Planned Parenthood for a year and provides avenues states could utilize to opt out of other Obamacare regulations.

The Congressional Budget Office will release its analysis of the bill the week of June 26^th.

For an up-to-date status summary of legislative changes that could affect CPAs, EAs, tax advisors, and their clients, follow along with our Trump Tracker for CPAs.

Nick Spoltore is Senior Director of Tax & Advisory Content for Surgent CPE. Mr. Spoltore is a graduate of the University of Notre Dame and of Delaware Law School. Before joining Surgent, he practiced tax and business law at the firm of Heaney, Kilcoyne in Pennsylvania and also in Delaware.