Health Care and the Marketplace

Beginning in January 2014, Americans must either be covered by health insurance or pay a tax penalty. To facilitate this program, either your state or the federal government must provide aMarketplace,” (also known as the Health Insurance Exchange) that enables you to compare and buy health policies from any of several different companies.

You can also use the program to find out if you qualify for a tax credit to help pay for the insurance or if you qualify for Medicaid assistance. You can reach the Marketplace through a website, through the mail or by telephone.

The plans in the Marketplace are offered by private insurance companies. All must provide a set of core benefits, and none may reject you because of an existing illness or other medical condition.

If you already have a health care policy, you needn’t do anything at all. You may, however, use the Marketplace to seek out and purchase cheaper and/or better coverage if available, unless you’re age 65 or older. In the latter case, you’ll generally be covered by Medicare and will not be subject to the new law.

If you don’t have health insurance, you can buy a policy directly from a provider, or you can use the Marketplace to find the coverage that suits you best. The cost will depend on the desired benefits, your income, and the size of your family. Marketplace information about prices and benefits will be provided so that you will be able to compare policies before you enroll.

To access the program, compare options, and/or sign up, visit the federal website at California has it’s own website at Covered California. If your state is running its own program, you’ll be directed to the appropriate website from You can also call 1-800-318-2596 for options, instructions, and answers to questions.

Consider a Health Savings Account

Many taxpayers could benefit from using an Health Savings Accounts (HSAs) to help control the cost of health care. HSAs are tax-sheltered accounts that, when combined with a high-deductible health insurance plan, allow a tax deduction for contributions made to the HSA.

Reduce Your Current Income

Essentially, the contribution to an HSA is deductible annually up to $3,250 if you’re single and $6,450 if you’re married. An additional $1,000 can be contributed if you are 55 or older.

These deductions help to reduce your current income taxes. Funds withdrawn from the HSA to pay medical bills are not treated as taxable income to you. It’s the best of all possible worlds: you receive a deduction for the contribution to the HSA and don’t have to recognize income when qualified medical payments are made by the HSA.

Qualifying for an HSA

In order to qualify for an HSA, you must participate in a high-deductible health insurance policy. This simply means that the deductible on your health policy can’t be less than $1,250 for self-only coverage or $2,500 for family coverage.

These are minimum deductible limits, and you’re free to participate in a health plan with higher limits and still qualify for an HSA. However, the maximum out-of-pocket expenses (including deductibles and co-payments, but not insurance premiums) can’t be more than $6,250 for self-only coverage or $12,500 for family coverage.

All of the limits noted are for 2013; these limits are adjusted annually for inflation. Contact Green FS to discuss or analyze the use of an  HSA.

Preparing for a Business Loan Application

As a small business you will, at some point, apply for a business loan. The lender will most likely have three main questions.

  1. How much do you want?
  2. For what will the money be used?
  3. How do you intend to repay the loan?

There are several parts to the answers for each of these.

First −You will need a detailed list of what the money will go for.

Ask yourself these questions:

  • Are your expenditures reasonable in light of what you intend to accomplish?
  • Will you be buying items which will improve your list of collateral to support the loan?

The nature of what you are buying will help determine the payback period. The purchase of inventory will require a shorter payback schedule than, say, the purchase of machinery or a building addition.

 Second − You will need to understand your repayment strategy. Ask yourself:

  • How do you intend to repay the loan?
  • Will repayment come from future projected profits?
    • If so, how will you repay if the profits are not forthcoming?

Here is a list of the written materials you may be asked to submit.

  • Three years of prior income tax returns.
  • Three years of company financial statements.
  • Personal balance sheet with cost and fair market value of assets.
  • Your personal resume, including your business experience and educational background.
  • A business plan with projected financial statements including cash flow statements.
  • Collateral list showing cost and market value as well as any debt against the items.
  • Contracts that concern income intended to be used for loan repayment.
  • Franchise agreements, if any.
  • Lease agreement for the business premises if you don’t own the property.

While assembling your loan package, keep in mind the lender’s overall concern and remind yourself of the three main questions they will ask you. You don’t have to go at it alone, contact your business advisor for assistance in putting together a solid loan package.