Posted on 01/11/2015 8:00:17 AM PST by Kaslin
Deluged with catastrophes, court challenges and criticism, Obamacare (ACA) has had a controversial life to date. Yet it is ready to enter a completely new phase where the implementation gets shifted to the Internal Revenue Service – America’s favorite three words. If you liked the health care plan up to now, you ain’t seen nothing yet.
2010 was actually the first year that the IRS was involved in Obamacare enforcement. The Small Business Health Care Tax Credit went into effect with this filing year. You may remember I wrote that there was mass resistance to this credit by the tax-preparer community. We could not figure out how to get the credit for our clients while at the same time keeping the cost of preparing the paperwork lower than the actual credit being received by our clients. The calculations and the complexity of the credit were obviously created by lawyers and policy wonks that have no discernible experience with taxes on this planet, let alone the United States. Accordingly to the Government Accountability Office (GAO), the result was that only 170,300 businesses took advantage of this credit during 2010 when it was estimated that between 1.4 and 4.0 million small business employers would be eligible. In fact, the credits were supposed to encourage small businesses that did not offer insurance to their employees to begin doing so. The GAO reported that the credits went to businesses that were already offering insurance to their employees.
That small amount of businesses claiming the credit was not because of preparer ignorance as supporters of Obamacare have claimed. To the contrary, the question becomes how many preparers took advantage of their clients by actually charging them for preparation of the paperwork to garner this credit?
Tax-year 2014 begins the filing of Obamacare-related reporting for individuals, and each person must report that they are in compliance with the new law through their own personal tax return. You think taxes were a nightmare before this? Each taxpayer must show that they have insurance or that they are exempt from insurance. To facilitate this the IRS has developed some spanking new forms for the benefit of us all. The primary form you must have in hand is a 1095 form. To make matters more complicated, the IRS could not live with one universal 1095 form; they had to develop three: A, B and C. A is for those receiving their insurance through the Obamacare websites, B is issued by insurance companies to people who have their own plans and C is for employees of large companies. Then there is another form (8965) if you have an exemption from having to have coverage.
I know you were thinking nothing could go wrong here. This is requiring millions and millions of additional forms to be filed by various insurance providers and sent to individuals who don’t have an understanding of the requirements. People will be receiving forms of which they have no understanding, and thus deluging their tax preparers with queries. I cannot wait until the IRS sends out millions of computer-generated letters threatening people and businesses about the fact they did not properly comply with the law. No wonder they hired 16,000 IRS agents to deal with this mess.
If you don’t have coverage as mandated by the law you are subject to (are you ready?) – The “Shared Responsibility Penalty.” Wow, some wonk worked ages to come up with that Orwellian name. Didn’t the Supreme Court determine that was a tax? What was Judge Roberts thinking?
We then get into the Premium Assistance Credit (PAC). That is what those people who go on the Obamacare website are told will reduce their premiums if they are income qualified. This has created a phenomenon rarely ever seen in our country. This has Americans working hard to reduce their income to reduce their health insurance premiums. Or others trying to falsely increase income to avoid being on Medicaid.
There are many traps here. The person teaching my class told of the poor schmoo who happily gets a Christmas bonus from his employer of $500. The problem is he has a family of four and his income before the bonus is $95,000. His new income of $95,500 exceeds the limit for income for a family of four to be eligible for the PAC by a whopping $100. He would then be exposed to refunding up to $12,000 of PAC through their tax return. Just wait until the happy Christmas bonus recipient finds that out around March.
While in class to learn about the implementation of all these new rules, we spent an entire morning going through the law and how it affects us (and thus you our clients). About two-thirds of the way through the morning I questioned the whole process. I stated that if someone walked into to my office who was receiving the PAC that I would not accept them as a client. The cost of preparing the paperwork to get them properly qualified to receive the benefit would exceed anything I could reasonably charge them. The instructor, a fine fellow from Iowa, stated he unfortunately had to agree with me. So now tax preparers will have to decide whether to accept clients based on our health care system -- just like doctors.
All of this mess was so that, to this time (prior to the 2014 enrollment period), 8.7 million people could be added to the Medicaid rolls and about three million Americans could lose their private insurance. 8.7 million people that are added to a system which already included 59 million people who could not find a doctor to serve them because of the meager reimbursement rates that exist.
Let me remind you of two things. Having health insurance does not equate to having health care despite the pleading of the Obamacare supporters. Also, Obamacare did zero, zilch, nada, bupkis, zippo to increase the supply of health care providers. Makes you wonder why doctors were involved in drafting this law.
I am sure you are really looking forward to preparing your income tax returns this coming year. But please don’t harm anyone after reading this column. There are simply not enough people to take care of them now.
You are joking right? You forgot the /s tag.
Our forefathers went to war against George III who is a piker compared to Barack the First.
Plus, the B and C forms are only in draft form. Electronic submission is required but IRS has not even published draft specs. We are to collect data to comply, effective now, but no one knows for sure what data will end up being required. This is a law designed and implemented by people who never ran so much as a news stand.
IMHO Obamacare is proof that the America I was born into is dead. My premiums have gone up fifteen percent every year since Obamacare was forced down our throat 4 years ago. I’ve told people that if God Himself came back as a Democrat (not that He would), they would find in a half hour Satan’s bumper sticker on my car. I’ll give the Dems credit for one thing, I’ve never donated more money and time to elections than I have the last 4 years.
One of the more interesting benefits of the FairTax is that, since it eliminates the IRS, it would also force a new debate on O[phony]bamacare.
Given all the negatives, FairTax will kill O[phony]bamacare, and that is just fine with me!
Clause 1 of Section 7 of Article I says simply, raising revenue. So no matter what activist justices and the “transparent” Obama Administration want to call Obamacare to try to deceive taxpayers, call it a tax, a fee or a penalty, it remains that they are all constitutionally indefensible sources of federal government revenue where intrastate healthcare is concerned imo.
I should have done a little more scratching before I posted earlier. The Constitution uses terms “raising revenue” and “appropriations” where taxes (fees, penalties, etc.) are concerned.
Granted, even under today’s loose Federal jurisprudence.
It would make sense for someone to challenge that tax as being unconstitutional.
But before that can happen, somebody has to be charged the tax.
Barack doesn’t want that kind of court case and neither, apparently, do a lot of Republicans (for different reasons). Maybe Congress will pass a bill excusing people from the tax and actually get Barack to sign it.
New tagline ...
Well, Tom,
I’M MAD AS HELL AND I’M NOT GOING TO TAKE IT ANYMORE!
After all, by unconstitutionally delegating federal legislative / regulatory powers to the IRS, corrupt Congress is wrongly protecting federal legislative powers from the wrath of the voters in blatant defiance of Section’s 1-3 mentioned above imo.
Next, the Constitution-ignoring bureaucrats running the IRS are also evidently ignoring that, despite what FDR’s activist justices wanted everybody to believe about the scope of Commerce Clause powers when it wrongly decided Wickard v. Filburn in corrupt Congress’s favor in 1942, that the states have never delegated to the feds, expressly via the Constitution, the specific power to regulate either intrastate commerce or intrastate healthcare.
In fact the Supreme Court has historically clarified, in a single statement nonetheless, that that Congress has neither the power to regulate intrastate healthcare or intrastate commerce.
”State inspection laws, health laws, and laws for regulating the internal commerce of a State, and those which respect turnpike roads, ferries, &c. are not within the power granted to Congress [emphases added].” —Gibbons v. Ogden, 1824.
And since the length of the work week and the size of a company’s work force are reasonably aspects of 10th Amendment-protected intrastate commerce, why is the IRS promoting Obamacare at the cost of ignoring the Constitution by making policy concerning these issues?
Another Constitution-related Supreme Court clarification that IRS needs to wise up to is that Congress is prohibited from laying taxes in the name of state power issues, healthcare a state power issue.
“Congress is not empowered to tax for those purposes which are within the exclusive province of the States.” —Justice John Marshall, Gibbons v. Ogden, 1824.
bookmark
Obamacare needs to be burned down by any means necessary and hanged around the neck of Hillary Clinton.
Portion of the fair tax monthly stipend could be used for a health savings account
Given that ALL savings (and interest earned thereon) are tax FRee under FairTax, a personal HSA becomes very doable and very affordable.
I am instinctively opposed to any forced savings plan. I believe that somehow, someway, Americans must begin to assume responsibility for themselves and their families, and wrest control away FRom the heavy hand of government.
since all will receive a repay of a certain level of taxation,
the implementation of such an account would hedge against non insured entities...
i too am an advocate of personal responsibility, but for those who scream “take care of me” this is a factor that may sway them to the side of the fair tax.
alas, i feel boehner and crew will not advocate for such a system.
Somehow, someway, we’ll have to convince them that they are FAR, FAR better off with the government out of their lives.
It is an education process that MUST be undertaken!
I share your pessimism re: Boehner and crew. All we can do is keep pressing the FairTax.
Thanks for your support!
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.