From the Supreme Court to the IRS
With the Supreme Court declaring ObamaCare's mandate a tax, the spotlight will soon shine on Uncle Sam's taxing arm -- the Internal Revenue Service. The Associated Press offers a preview.
The Supreme Court's decision to uphold most of President Barack Obama's health care law will come home to roost for most taxpayers in about 2 1/2 years, when they'll have to start providing proof on their tax returns that they have health insurance.
That scenario puts the Internal Revenue Service at the center of the debate, renewing questions about whether the agency is capable of policing the health care decisions of millions of people in the United States while also collecting the taxes needed to run the federal government.
Here's a taste of what taxpayers can expect as the IRS carries out its new responsibilities.
The changes will require new regulations, forms and publications, new computer programs and a big new outreach program to explain it all to taxpayers and tax professionals. Businesses that don't claim an exemption will have to prove they offer health insurance to employees.
The health care law "includes the largest set of tax law changes in more than 20 years," according to the Treasury inspector general who oversees the IRS. The agency will have to hire thousands of workers to manage it, requiring significant budget increases that already are being targeted by congressional Republicans determined to dismantle the president's signature initiative.
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Comments:
May '10
Re: From the Supreme Court to the IRS
We need something like this to be the first thing everyone thinks and says when the subject comes up:
"swarms of IRS agents setting out to tax the uninsured"
Re: From the Supreme Court to the IRS
Gee, thanks, Jonathan. I was in a lovely mood today...until I read this.
Jul '12
Re: From the Supreme Court to the IRS
Matthew Bartle: We need something like this to be the first thing everyone thinks and says when the subject comes up:
"swarms of IRS agents setting out to tax the uninsured" · 3 hours ago
I'm of two minds on that. It's not like we're not already well-stocked with anti-friction arguments. We tolerate the current code and its enforcement, afterall. Not compelling, and I don't know why that is.
On the other hand, personally, there's nothing like a trip to the local DMV to induce a (lengthy) meditation on libertarianism. I generally exit quoting Murray Rothbard at the top of my lungs. The cool thing about that is that someone usually shoves a quarter in my hand and says, "oh you poor man."
Re: From the Supreme Court to the IRS
My apologies. I just couldn't think of any positive spin on the "largest set of tax law changes in more than 20 years" being the ObamaCare mandate, er, tax.
Mar '11
Re: From the Supreme Court to the IRS
A big boon for tax attorneys is coming. Just what our nation needs; more intelligent, educated citizens focusing on how to unwrap the enigma that is the U.S. tax code instead of doing work that produces something positive for our country.
Jul '12
Re: From the Supreme Court to the IRS
This is another example a government plan to squander resources (mistakes are bad enough) rathert than focusing on the real issue of providing more and better healthcare. If we currently can not afford healthcare for all, it seems that adding billions of expense in new regulations/computer systems and personnel to manage the limited care giving resources we have is loosing total sight/focus of the real need to make our healthcare system both more efficient and effective by providing incentives to expand treatment capability.
Dec '11
Re: From the Supreme Court to the IRS
Just one of the logical problems in the administration of Obamacare is means testing for the insurance exchanges. The IRS can’t rely on checking returns because the poor don’t always file returns when their income results in no tax liability. So the IRS will have to check eligibility by aggregating the supporting documents, W-2s, 1099s, self-emloyed income, etc. Not only is this difficult to do in practice, the IRS didn’t have enough data to do it properly. The PPACA contained a huge expansion of the requirement to file 1099s for business purchases and rental income. This provision proved so unpopular that it was repealed in 2011.
So, unless the law is repealed, cases where clerical errors that wouldn’t rise to the level of an audit or letter from the IRS can affect insurance (tax) rates.
Sep '10
Re: From the Supreme Court to the IRS
"Businesses that don't claim an exemption will have to prove they offer health insurance to employees."
I'm sure this will result in a hiring boom at small businesses all across this country.
<sarcasm off>