WASHINGTON, March 27 (UPI) -- AT&T Inc. says it will take a $1 billion charge against earnings because the federal healthcare overhaul cancels a tax benefit the company received.
AT&T, and other U.S. companies that provide prescription-drug benefits to retirees, receive a federal subsidy, the value of which also can be deducted from the firms' taxes.
The healthcare overhaul plan signed by President Obama this week cancels the deductibility of the subsidy, The Wall Street Journal reported Saturday.
They "have a stream of tax benefits that they are losing way out into the future," said Roland McDevitt, head of healthcare research at Towers Watson, a benefits consultant.
So far, other companies taking the one-time charge include 3M Co., Deere & Co., Caterpillar Inc. and AK Steel Holding Corp., the Journal reported.
Credit Suisse this week estimated that companies in the S&P 500 index combined could take as much as a $4.5 billion charge due to the change in the value of the tax asset.