Masonry Magazine June 1969 Page. 22
Taxes
(Continued from page 20)
antees a fixed payment during the time of hospitalization or a salary reimbursement policy.
The reimbursement of medical expenses is, of course, tax free. However, what happens when a taxpayer receives an amount that exceeds his actual medical expenses-sometimes due to the fact that he has several medical insurance policies? The IRS has ruled that it depends on who has paid the premiums for the policies. If the taxpayer's employer pays all or part of the premium, the excess reimbursement is taxable to the taxpayer to the extent of the employer's contribution. On the other hand, if the taxpayer pays for his own medical insurance, the excess reimbursement is not taxable, even though he is covered under more than one policy.
For example: The taxpayer has two personal medical insurance policies, A and B. The premiums are $180 a year for Policy A and $100 a year for Policy B. During the year, the taxpayer incurs medical expenses of $720 and is reimbursed $500 by Policy A and $400 by Policy B. The excess reimbursement ($180) is not taxable.
However, should the taxpayer have two such policies but one (Policy A) is paid for by his employer, the result would be different. The taxpayer would be taxed on 5/9ths of his excess reimbursement. This is so because Policy A paid 5/9ths of the total reimbursement (or $500 of $900). Therefore, 5/9ths of the excess would be attributable to Policy A, which was paid for by the employer. See Com. Cl. House, Par. 8185.
Legislative Oversight
In connection with H.R. 10 plans, Congress has now corrected its omission of an effective date for the 1966 amendment redefining "earned income" for the purposes of computing contributions to pension plans for self-employed individuals. The effective date has now been set for taxable years after 1967. Under the new definition "earned income" is no longer limited to 30% of total income where capital is a material income-producing factor. Also, the three year averaging provisions of Code Section 401 (e) (3), applicable in determining whether excessive contributions have been made to such plans, would be applied as though the new definition had been in effect prior to 1968.
Monowall Featured At Nagel Plaza
Nagel Plaza, Detroit, a revolutionary, low-cost housing project featuring the "Monowall" structural system, was subject of a detailed story in MASONRY, May, 1969, pp 30 and 31. Looking over the plans in front of one of the units are builders Deane Baker, president of Campbell Modular Building, Inc., and H. Fred Campbell, chairman. This firm is part of the Campbell Group which is applying to housing 40 years of experience gained in reducing costs of industrial and commercial buildings by using new methods and materials.
Construction Climate Improves
The industrial construction climate in Louisiana's Baton Rouge area has improved consistently since mid-1967 when management closed down $500 million worth of new plant construction, mainly petrochemicals, because of jurisdictional strikes.
The Baton Rouge Joint Labor-Management Committee reports that work stoppages during the past few months have been reduced to "an absolute minimum and far below that of comparable areas of our nation."
This sharp decline in construction labor trouble indicates marked improvement even since last fall when the Committee reported that work stoppages had been reduced by 50 per cent since the shut down.
In a progress report, the Committee stated: "The overwhelming majority of our labor contracts have been negotiated without incident and without work stoppages. Those contracts yet to be negotiated are making substantial progress.
"The harmony and spirit of cooperation that now exists between labor and management are a testimonial to the sincerity of both groups. The Baton Rouge area has cleaned its house and the house will continue to be kept clean."
Ralph Howe, manager of the Humble Oil Refinery in Baton Rouge, said that in the last few months area work stoppages had been taking place at a rate of less than two a month.
Serving as co-chairman of the Baton Rouge Labor-Management Committee are R. D. Shaddix, regional director of the AFL-CIO Building and Construction Trades Department, and Frank Schoenberg, Bechtel Corporation.