Tag Archives: Small Business

New IRS Regulation Threatens Small Businesses With Fines For Helping Workers With Health Costs

A new regulation that went into effect on July 1 threatens small businesses with fines from the Internal Revenue Service of up to $36,500 a year per employee, if the businesses help their employees with health costs by reimbursing them for the cost of their healthcare premiums or by paying for their health costs directly.

The National Federation of Independent Business (NFIB) reported that the new regulation, which is not part of the Affordable Care Act, states that employers who compensate their employees for health costs, rather than offering a group health plan, “can be fined $100 per day, per employee,” which adds up to “$36,500 per employee up to $500,000 in total.”

Gracie-Marie Turner, the founder of the Galen Institute and a contributor to Forbes, noted that this new regulation is more than “18 times greater than the $2,000 employer-mandate penalty under Obamacare for not providing qualifying health insurance for employees,” and while employers with fewer than 50 employees are exempt from the employer-mandate penalty under Obamacare, they are not exempt from this penalty from the IRS.

“The rule appears nowhere in the Affordable Care Act but was developed by the Obama administration’s regulation writers at the IRS,” Turner wrote. “The rule punishes small businesses for providing the only health insurance support many can afford – a contribution to help employees pay premiums for their individual or family health insurance policies or to help finance direct payment for medical services.”

Kevin Kuhlman, NFIB’s policy director, called the new regulations the “biggest penalty no one is talking about.”

“The penalty for compensating employees for healthcare-related expenses is enough to destroy most small businesses,” Kuhlman said. “Reimbursing employees for the cost of insurance or medical services is a way for small businesses to help their workers without the administrative headaches of setting up a costly group plan.”

In response to the regulation, Rep. Charles Boustany (R-La.) introduced H.R. 2911 in the House and Sen. Charles Grassley (R-Iowa) introduced S.1697 in the Senate. Both bills are labeled as “Small Business Healthcare Relief Acts” and are awaiting congressional action.

Ben Swann Talks With Liberty Congressional Candidate Art Alas About Sriracha Victory

Ben Swann spoke with liberty Republican Congressional candidate Art Alas Thursday, discussing the recent events surrounding the Huy Fong Foods factory in Irwindale, California. The battle between Huy Fong Foods and California government officials has sparked national debate about rights of business owners and increasing government regulations.

Sriracha sauce, the widly popular chili sauce made by Huy Fong Foods, was at the center of controversy beginning last fall. Huy Fong Foods was accused by Irwindale residents of causing allergic reactions and discomfort; some said that the factory was emitting a powerfully spicy odor and making people sick. “It feels a little like pepper spray,” said one resident who lived near the factory.

The city of Irwindale then sued Huy Fong Foods and threatened to declare the company a public nuisance. The legal battle became national news, and there was discussion about whether or not Huy Fong Foods would continue its business in California. “Other cities say, ‘Irwindale is not friendly, come to my city,’ ”  Huy Fong Foods CEO David Tran said. “Other states say, ‘California is not friendly, come to my state.’ Other countries say, ‘U.S.A. is not friendly, come back here.’ ”

Tran moved to the United States 35 years ago from Vietnam to escape its Communist government, and he started his sriracha manufacturing in a small warehouse in Los Angeles in 1980. Business had been booming for Tran, becoming an $80 million enterprise before the complaints began. In an attempt to solve the issue, Tran installed stronger filters at the factory on two occasions. Tran has long disputed the accusation that the factory’s odor is noxious.

In addition to the lawsuit from Irwindale, Huy Fong Foods was forced by the California Department of Public Health to stop sales of sriracha sauce for 30 days back in December 2013 to ensure food safety due to the sauce being bottled raw. Earlier this month, Tran compared the government in the US to communist Vietnam, saying, “Today, I feel almost the same. Even now, we live in [the] USA, and my feeling, the government, not a big difference.”

The Huy Fong controversy seems to have come to an end, since Irwindale city officials decided to dismiss the lawsuit and no longer push to declare the Huy Fong Foods factory a public nuisance. The decision was made after Tran hosted a tour of his factory with Irwindale officials. “We’re looking forward to being partners for a long, long time,” said Irwindale Mayor Mark Breceda. “We’re almost sorry that this has gone on so long.”

On Ben Swann’s radio program Thursday, Alas discussed what he had experienced in the Huy Fong Foods factory.  Alas said that this entire issue began because of 4 complainants, one of whom is a relative of a city council member. “This is just another attack on small business in the area,” said Alas.

Alas mentioned that the Irwindale City Council is under investigation for several issues including alleged misappropriation of funds.

Tran gave Alas a tour of the factory, and Alas said he was unable to smell the overwhelming odor that others had complained about. “After taking a tour, I didn’t see what they were talking about,” Alas said.

Alas told Swann that he had previously asked public officials to tour the factory themselves, but the officials didn’t act on it until this past Tuesday. Alas went on to explain that if Huy Fong Foods had indeed been declared a public nuisance, Tran would have had 90 days to fix the issue to the satisfaction of the city. If the repairs were not sufficient for the city, officials would have stepped in to remedy the situation themselves, with Tran footing the bill for any of their demands.

The interview with Art Alas is available below.

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