The UVW union and HON Corporation are negotiationcontract terms. Assume the union members are in the 28% marginaltax bracket and all benefits are provided on a nondiscriminatorybasis. Write a letter to the UVW Union members explaining the taxconsequences of the options discussed below. The union'saddress is 905 Spruce Street, Washington, D.C. 20227.
a. The company would impose a $100 deductible on medicalinsurance benefits. Most employees incur more than $100 each yearin medical expenses.
b. Employees wold get an additional paid holiday with the same annual income (the same pay but less work).
c. An employee who did not need health insurance(because the employee's spouse works and receives familycoverage) would be allowed to receive the cash value of thecoverage.