Skip to comments.Will IRS bully people to sign up for Obamacare?
Posted on 01/14/2014 2:23:49 AM PST by Cincinatus' Wife
The individual mandate, Obamacare's requirement that all Americans have health insurance that includes "minimum essential coverage," has been in effect for two weeks now. No one has noticed because nothing has happened. But it will.
The mandate is the heart of Obamacare; without it, supporters believe, the system won't work. So the Obama administration hopes millions of Americans will voluntarily comply with the mandate and purchase government-approved coverage. If they don't do it voluntarily, they'll be punished.
Starting next year, the government will collect a penalty the administration calls it a "shared responsibility payment" from Americans who don't go along with the Obamacare edict. The penalty starts small just $95 per adult and $47.50 per child this year but could conceivably reach thousands of dollars per family per year once the fee scale is fully in effect.
The threat of coercion lies behind the entire Obamacare scheme. The question for the coming year is, how coercive will the government be?
The Democrats who wrote the Affordable Care Act in 2009 gave the Internal Revenue Service power to collect Obamacare penalties. Many Americans are quite familiar with how coercive the IRS can be. Fearing public opposition to IRS threats, the law's authors forbade the IRS from bringing criminal charges or seizing houses and property from those who don't buy government-defined "minimum essential coverage." But Democrats still gave the IRS significant authority.
"Although the Act provides that the IRS may not use criminal prosecutions, notices of federal tax liens, or levies on property to collect an unpaid penalty, the IRS may employ offsets against federal tax refunds," the Obama administration wrote in its 2012 Supreme Court brief in defense of the mandate. "The IRS also may seek payment through correspondence or phone calls from IRS employees."
The main leverage the IRS will have is the refund "offset." That simply means if a taxpayer is due a refund, but has also incurred an Obamacare penalty, the penalty will be subtracted from the refund. So a taxpayer who has a $500 refund coming but incurs a $695 Obamacare penalty will receive no refund.
In addition, that taxpayer might face a letter and a phone call or a series of them from the IRS telling him to pay the rest. Anyone who has received a letter or phone call from the IRS knows the experience can be quite intimidating. Or, in the words of the administration's Supreme Court brief: "Offsets, correspondence, and phone calls are consistently some of the most productive tools in the federal tax collection process."
Will the government really do that? The answer is not clear, or at least not publicly clear. (In response to inquiries, IRS officials sent boilerplate, non-enlightening clips from IRS publications.) But the administration's level of aggressiveness will likely be determined by how many Americans voluntarily comply with the law.
Obamacare needs a lot of them to survive. In the last few months, discussion often focused on the prediction that the system needed to enroll seven million people by the time open enrollment is over at the end of March. But even if Obamacare reaches that goal and it's doubtful right now that is just the start. To work, Obamacare must keep growing. A lot.
"I think we're going to ultimately need about 20 million people for a sustainable pool," health care analyst Robert Laszewski told the Washington Post recently. "So when I hear people talk about the goal being seven million, I think, 'time out.' This needs to be 20 million people within three years."
How does it get there? Well, if Obamacare is a great deal that millions of Americans love, it will reach the goal with no problem. If, on the other hand, it presents Americans with policies that don't fit their needs, are too expensive, have cripplingly high deductibles, and narrow choices of doctors well, many Americans will balk at buying such a product.
It's not that they will reject health coverage; it's that they'll reject health coverage that's a bad deal.
And if that happens, the question of 2015 will be how far the Obama administration will go to force Americans to buy policies they don't want. "The government will be hard-pressed to collect a fine on something lots of people don't believe has value," says Laszewski. "This is when it will become a huge political albatross."
Such a scenario could create enormous political pressure to scrap the individual mandate. And at that point, the future of Obamacare would be very much in doubt.
****Jan 13, 2014 - Baltimore Sun: Politics trumped prudence in Md. Obamacare exchange [Editorial] "The train wreck of Maryland's Affordable Care Act insurance exchange should have been no surprise to Gov. Martin O'Malley, Lt. Gov. Anthony G. Brown or anyone else responsible for its creation. That's the unmistakable conclusion from a Washington Post article on Sunday based on not-previously disclosed documents and interviews with key participants. The Post's report fleshes out the story of dysfunction revealed in records obtained last month by The Sun through a public information request and leaves no doubt that state officials were warned repeatedly and in detail that the website was, in one former official's words, "a disaster waiting to happen." The more of the picture we see the clearer it becomes that political considerations trumped prudence and that Marylanders in need of quality health insurance paid the price.
Much of the Post report by Aaron C. Davis and Mary Pat Flaherty relies on audits, letters, emails and other documents to or from the Portland, Maine-based firm BerryDunn, which was paid $9 million to provide oversight for the development of Maryland's exchange. Among the highlights:..........." ***** FR Thread
The IRS won’t intimidate me or my family. Come and get me, but I won’t go down easy.
If I understand the ACA correctly, the IRS can only seize REFUNDS for the amount the government says you owe in penalty for not buying the insurance. I’m guessing that’s because the administration and Democrats have maintained that it is NOT a tax, ergo, the IRS can’t collect it via its usual thuggery means - garnishing wages, bank accounts, liens, etc.
It is ironic that the reason they can’t do this - it isn’t a tax according to them - was the one thing Traitor Justice Roberts maintained in his decision - it is a tax.
Regardless, unless they change the rules, the IRS can only get your refunds. If you aren’t due a refund, all they can do is harass you.
You know when this is going to get really interesting?
When money gets tight, millions of low income folks are going to stop paying their monthly premiums.
What will happen is they will start taking the Obamacare penalty fees from payroll taxes first...anything collected after that applies to taxes due.
When the end of the year comes around you will owe taxes, not a penalty fee...and they know how to collect taxes.
At one point a number of years ago, I knew to the penny what my annual income would be. Also, it was possible to define yourself in your W-4 form as “married + “X” dependents + take out an additional $52.73” So, I worked with payroll to do just that. Sometimes, it took a mid-year revision of my W-4 form to get it right, depending on what tax changes had occured. No CPA or tax lawyer involved; just a piece of lined paper an a pen. One year I owed an additional $5 on April 15th, and another year I got a check for $9. Merely a thought......
But,If Obamacare IS a tax as Justice Roberts described it,you should be able to deduct the premiums or penalty on your tax return.
You are right, but they do not follow any rules...rules are only for republicans.
They will do what I described.
What do you think all those visits to the Whitehouse were about..... an easter egg hunt?...../s
Do bears ____ in the woods? They will bully, prod, intimidate and increase the pressure and threats until the mailed fist is fully in view.
From the article:
“.....But Democrats still gave the IRS significant authority.
“Although the Act provides that the IRS may not use criminal prosecutions, notices of federal tax liens, or levies on property to collect an unpaid penalty, the IRS may employ offsets against federal tax refunds,” the Obama administration wrote in its 2012 Supreme Court brief in defense of the mandate. “The IRS also may seek payment through correspondence or phone calls from IRS employees.”........
That crossed my mind.
How is that going to work? Huh?
Not so good.
Title 42 § 18115
Freedom not to participate in Federal health insurance programs
No individual, company, business, nonprofit entity, or health insurance issuer offering group or individual health insurance coverage shall be required to participate in any Federal health insurance program created under this Act (or any amendments made by this Act), or in any Federal health insurance program expanded by this Act (or any such amendments), and there shall be no penalty or fine imposed upon any such issuer for choosing not to participate in such programs.
(Pub. L. 111148, title I, § 1555, Mar. 23, 2010, 124 Stat. 260.)
It’s all vapor and Obama promises.
What IS the GOP doing about IRS targeting of conservative Tea Party groups?