Victor Godinez
The Dallas Morning News
3/27/2010
AT & T Inc. said Friday it will take a $1 billion noncash charge to account for changes brought about by the national health care bill signed into law this week.
Previously, companies could get tax-free subsidies to help pay for prescription drug coverage for retired workers and, on top of that, could deduct those subsidies from their total tax bill.
Under the new law, the original subsidies will still be tax-free, but the companies no longer will be allowed to deduct the subsidy from their total taxes.
“As a result of this legislation, including the additional tax burden, AT&T will be evaluating prospective changes to the active and retiree health care benefits offered by the company,” AT&T said in a brief filing with the Securities and Exchange Commission…
…AT&T is the latest in a string of companies to announce charges resulting from the new law, but its charge is by far the biggest. 3M Co., Deere & Co., Caterpillar Inc. and AK Steel Holding Corp. have recently announced charges ranging from $31 million to $150 million.
The company announcements Friday prompted Democrats in Congress to push back.
Rep. Henry Waxman, a California Democrat who co-chairs a subcommittee on oversight and investigations, said he’ll convene a hearing next month to question company executives about their moves.
“The new law is designed to expand coverage and bring down costs, so your assertions are a matter of concern,” said a letter from Waxman and co-chair Bart Stupak inviting executives such as AT&T chief executive Randall Stephenson to testify…
Read the entire article at The Dallas Morning News.
