“Cadillac Tax” on Health Care Plans Likely to Be Repealed


by DeEtte L. Loeffler, J.D., LL.M., Taxation

When the Affordable Care Act (aka “Obamacare”) was enacted, it included a punitive 40% excise tax to be imposed on employers who provided employees with high quality health care plans. This “Cadillac Tax” would be imposed on employers for every dollar spent by them (or by employees) above a certain level and would not be deductible by the employer. The tax was originally meant to go into effect in 2018, but was postponed to 2020. President-elect Trump has indicated this tax will be repealed and, with a Republican-controlled House and Senate, this seems likely.

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