HR 3 Imposes Tax Penalties on Individuals and Small Businesses with Insurance Plans that Cover Abortions

Thank you to our friends at the National Women’s Law Center for the information below.

Recently the House of Representatives introduced a bill, H.R. 3, that many are talking about as it more narrowly defines when federal funding could be used to pay for an abortion. What people may not be mentioning is that in addition to narrowing the scope of abortion, it could potentially raise your taxes.

H.R. 3 would impose tax penalties on individuals and small businesses with insurance plans that include abortion. Anyone with an insurance plan that covers abortion would have to pay higher taxes than people whose health plans do not – even if they never knew their plan would cover an abortion and never used that coverage. Depending on what kinds of tax benefits you’re eligible for, the tax burden could be substantial.

Below are two examples from the National Women’s Law Center that show just how this tax penalty would impact real families and individuals:
  • If a father of three working as an assembly lineman loses his job when his manufacturing plant closes, he is currently eligible for the Health Coverage Tax Credit to help with the costs of his $13,770 insurance premium. But, because his insurance plan included coverage of abortion—even though he never knew about this benefit and no one in his family ever used it—H.R. 3 would suddenly make him ineligible for the benefit and would cost him $11,236.
  • Under current law, taxpayers may deduct the portion of their medical expenses, including insurance premiums, that exceeds 7.5% of their gross income. Therefore, a woman earning $25,000 is eligible to deduct any amount over $1,875 she spends on health expenses, including her insurance premiums, from her taxable income. If H.R. 3 were enacted and her health insurance plan includes coverage of abortion, she would lose a $1,731 deduction. More than 7.5 million families claim this particular medical expense deduction—and each of them would lose the deduction if their plan covers abortion.
Currently over 80% of insurance plans cover care for an abortion. If this bill were enacted, those that are subject to the tax penalties levied under H.R. 3 will face significant increased costs just for keeping the comprehensive insurance coverage they currently have. Contact your Representative today and urge them to vote against a bill that limits a women’s heath coverage and increases taxes for individuals.


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