Tuesday, December 30, 2014

In 2015 The IRS Will Collect ObamaCare Penalties

Once they have their hand on your wallet, your heart and mind will follow.

Anonymous

In 2015, the IRS will begin to collect $325 from Americans’ wallets if they did not have a health insurance plan. This penalty , of course, is the guts of the individual mandate, a chief source of ObamaCare funding.

How this mandatory funding will play out politically is very much in doubt. Over 90% of Americans are not even aware of the ObamaCare penalty, and even if they were, it would be just as unpopular as the law, which 57% oppose.

Most Americans will not be aware of the $325 penalty or 2% of their income until they fill out their tax returns or see sharply diminished tax refunds.

Because of budget cuts, the IRS may not the money or resources to collect penalties from health plan- negligents. The coming 2015 penalties will be first time all taxpayers will have to report to the IRS if they have health insurance the previous year, if their tax status or income has changed, or that they have to pay $325 or 2% of their income if they have been naughty by not being insured.

The unexpected penalties will surely be unpopular, just as the law has been. The GOP will seek to undermine the law and its bureaucratic mishmash. Who will be assessed for penalties resides in murky gray zones since the law offers 30 exemptions or waivers for those undergoing financial hardships. H&R Block says 4 million will eventually pay penalties and 26 million will qualify for exemptions. Some taxpayers may find whether they qualify by going to Turbo Tax and clicking on “Exceptions Check,” but most will be in dark.

Taxpayers must act before February 15, the end of the second health exchange enrollment period, to see if they are exempt from payment. But according to the Kaiser Foundation, only 5% are aware of this deadline.

“We could be looking at a real train wreck after February 15, says Stan Dorn, a policy expert at the non-partisan Urban Institute. " People will file their tax returns and they will learn they are subject for a much larger penalty in 2015, and they can do absolutely nothing about it. “ We shall soon see if the “train wreck” metaphor, first advanced by then Democratic Senator, Max Baucas of Montana, holds.

One ObamaCare critic tartly observed, “ Alas, there will be no way to save your ass by weaseling out of the bureaucratic morass."

Whether taxpayers will resign themselves to their fates, Obamacare will collapse of its own political weight, the GOP will repeal the health law, Democrats will delay implementation of the individual mandate, or the health law will prevail via a Presidential veto, no one can say with confidence. All taxpayers can do is to hold onto their wallets and pray that political compromise and what’s best for the country, and for the hearts and minds of their fellow countrymen, will prevail.

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