FICA Holiday- While wage earners have already received this through their paycheck, self employed individuals will see a reduction in self employment tax of 2%. Thus, the SE Tax is 13.3%.
Health Insurance Premiums Will No Longer Deduct From SE Tax- While health insurance premiums are can still be an adjustment to income, for self employed people, you will no longer be able to deduct the premiums from Self Employment Taxes.
Penalties On Health Plans- As it stands currently, you cannot take from your HSA, MSA, or Flexible spending accounts to pay for over the counter drugs. With that said, any non-qualified distributions from any of the above plans will result in a new 20% penalty.
Health Insurance Premiums on the W-2- Although this is not being enforced by the IRS for 2011, Employers must report the value of health insurance coverage (not including amounts employees elect to contribute to health FSAs) they provide to their employees on the employee’s Form W-2.