November 1, 2012 – Making Sure That the Clients With Pre-Existing Medical Conditions Can Maintain Health Insurance by Self-Employment or Otherwise and The End of Wondering and Wandering Through the World of Wandry and Formula Clauses
MAKING SURE THAT CLIENTS WITH PRE-
EXISTING MEDICAL CONDITIONS CAN MAINTAIN HEALTH INSURANCE BY SELF- EMPLOYMENT OR OTHERWISE.
Written with Thomas C. Davis, RFC
Integrated Wealth Management, LLC
THE END OF WONDERING AND WANDERING THROUGH THE WORLD OF WANDRY AND FORMULA CLAUSES
We welcome contributions for future Thursday Report topics. If you are interested in making a contribution as a guest writer please email Janine Ruggiero at Janine@gassmanpa.com
This report and other Thursday Reports can be found on our website at
This week we are pleased to have guest author, Thomas C. Davis, RFC, of Integrated Wealth Management, LLC. Mr. Davis can be reached at 813-
Making Sure That Clients with Pre-
Existing Medical Conditions Can Maintain Health Insurance by Self- Employment as a “Group of One”
Many of us have self-
The best alternative is to obtain a small group insurance policy as a small employer. Many insurance agents recommend Blue Cross Blue Shield for this purpose because they are “in Florida to stay” and generally have good coverage.
Other carriers that are commonly recommended include UnitedHealthcare and Aetna.
Clients who cannot qualify for individual coverage or who have a family member who cannot qualify for an employer-
Florida is ranked 48th out of the 50 states for the highest rates of uninsured individuals. One main reason is that individuals can be denied coverage if they have a pre-
The trick is that all health care insurance carriers must offer coverage to small businesses, and a pre-
Under guaranteed issuance, at least two plans are available to small businesses; a small employer health benefit plan and a high-
Importantly, while these plans can require a waiting period for individuals with pre-
Some insurance companies have policies that reduce the allowed statutory wait time. For example, Blue Cross Blue Shield has a maximum 12 month wait period for small business plans. Blue Cross Blue Shield also looks at previous insurance coverage and the pre-
Because the wait period can be reduced when previous coverage is held by the individual, maintaining health insurance in gaps of coverage is important. Clients should be aware that temporary medical insurance policies are available on the marketplace for individuals who are between jobs. Temporary health insurance is exempt from HIPPA, meaning that when the term is over, extended coverage will not necessarily be granted. This lack of guarantee makes small employer coverage a better option for individuals with a business.
Pursuant to Florida Statutes Section 627.6699(3)(v), a group of one must register between August 1 and August 31 in order to get the guaranteed issuance starting on October 1 of the year registered. Most carriers will enforce this enrollment rule, so a client who is on COBRA or who is perhaps receiving medical insurance from another state by reason of other arrangements should set their calendar to apply for a group plan in the month of August.
If the group has two or more employees (including the owner), then enrollment is ongoing. Therefore, small businesses that are larger than a sole-
The only downside to small business health insurance as an alternative to an individual plan is that a carrier can make an adjustment in the rate based on the pre-
The End of Wondering and Wandering through the World of Wandry and Formula Clauses
After formula clauses not using disclaimer or charitable elements received approval by the U.S. Tax Court in Wandry v. Commissioner T.C. Memo 2012-
Many commentators believed that the IRS nevertheless would challenge the result in Wandry by appealing it to the 10th Circuit, and that the IRS might have a chance of winning the case on appeal. As expected, the IRS appealed the Wandry case to the 10th Circuit in August of 2012; however, on October 17, 2012, the IRS withdrew its appeal by voluntarily dismissing its appeal to the 10th Circuit.
While there is no explanation for why the IRS withdrew its appeal, commentators have speculated that the IRS did not want to lose a formula clause case in another circuit in light of recent taxpayer victories in the McCord, Christiansen, Peter and Hendricks cases.
For now, estate planners are safe using Wandry-
APPLICABLE FEDERAL RATES
We are providing this month’s, last month’s, and the preceding month’s Applicable Federal Rates, because for a sale, you can use the lowest of the 3. To view the chart, please click here.
NEWS AND UPCOMING EVENTS
MONDAY, NOVEMBER 5, 2012 12:30 pm – 1:00 pm
Please join us for Lunch Talk, a free monthly webinar series from the Clearwater Bar Association. This month’s topic is What Lawyers Need to Know About Surveys – How to Read Them and What to Check with guest speaker David Brittain. To register for the webinar please visit: www.clearwaterbar.org
TUESDAY, NOVEMBER 13, 2012 12:30 – 1:30 pm
Pension actuary Jim Feutz will join Alan Gassman for a webinar on Update of Pension, Labor and Tax Laws, Including 2012 Law Changes and Anticipate Changes for 2013. This webinar qualifies for 1 hour of continuing education credit. To register for the webinar please click here.
TUESDAY, NOVEMBER 13, 2012, 5:30 – 6:00 pm
Alan S. Gassman will be joined by health care attorney Lester Perling to speak on What Physicians Need to Know About “Excluded Persons” and How to Make Sure You Do Not Have One. To register for the webinar please click here.
WEDNESDAY, NOVEMBER 14, 12:30 –
The Whistleblower Threat: Do You Have It and What Can You Do About It? Lester Perling, J.D., M.H.A. and Alan S. Gassman, J.D., LL.M. will be presenting a webinar on the whistleblower threat. To register for the webinar please click here.
For details about each event, please visit us online at gassmanlaw.com/newsandevents.html
Christopher Denicolo, J.D., LL.M. is a partner at the Clearwater, Florida law firm of Gassman, Crotty & Denicolo, P.A., where he practices in the areas of estate tax and trust planning, taxation, physician representation, and corporate and business law. He has co-
Kenneth J. Crotty, J.D., LL.M., is a partner at the Clearwater, Florida law firm of Gassman, Crotty & Denicolo, P.A., where he practices in the areas of estate tax and trust planning, taxation, physician representation, and corporate and business law. Mr. Crotty has co-
Thank you to our law clerks that assisted us in preparing this report:
Kacie Hohnadell is a third-
Alexandra Fugate earned her B.A. in English from the University of Florida in 2008, and J.D. from Stetson University College of Law in 2012. She has been a Guardian ad Litem for the past two years, a judicial intern for the Twelfth Circuit in Bradenton, and was recently admitted to the Florida Bar. She wants to pursue a career in business, employment, and labor law. Her email is Alexandra@gassmanpa.com
Eric Moody is a third-