#Obamacare Chronicles: two-thirds of subsidy recipients had to repay the government

April 28, 2015
"Obamacare has arrived"

“Obamacare has arrived”

This should make some people mad:

Nearly two in three Americans who bought subsidized health insurance on the Obamacare exchanges this year had to pay some of the federal dollars back, according to new data from H&R Block.

That’s because they presumably collected more federal aid than their income qualified them for. In that case, consumers must either pay some of it back or — in most cases — the IRS will subtract it from their tax refund.

Policymakers have expressed concern that low-income people could struggle with paying back the subsidies — or suffer if their tax refunds are greatly reduced because of overpayments.

The average amount consumers owed back to the government was $729, cutting their potential tax refunds by almost one-third, said the tax preparation company.

The article also mentions that 25% of Obamacare subsidy receivers received larger refunds because their income was less than expected. Good for them.

BUT… It’s the angry people who will remember this: they were forced to give up policies and medical providers they liked and that met their needs for more expensive policies and more restricted networks that didn’t meet the needs they had and met “needs” they didn’t have. (1) Then they were forced to pay even more, giving back some of the tax refund (2) they thought they were getting, maybe even had already spent. And this will happen again in 2016, an election year.

Angry people have long memories.

Footnote:
(1) Like maternity coverage for elderly couples. Really.
(2) I know you have trouble with the concept, progressives, but the money belongs to the one who earned it. The government just takes it. And so a refund is just giving a person back his own money — without interest.


In the Left’s Orwellian World, Taxpayers Who Get to Keep their Income Are Getting “Handouts”

April 19, 2015

Phineas Fahrquar:

The difference between a conservative and a progressive: the conservative believes the money you earn is yours, and the government should take only the minimum it needs to perform necessary tasks. The progressive believes the money is yours, but government knows best how it should be used and how much you really need.

Originally posted on International Liberty:

I’ve sometimes asserted, only half-jokingly, that statists believe all of our income belongs to the government and that we should be grateful if we’re allowed to keep any slice of what we earn.

This is, at least in part, the mentality behind the “tax expenditure” concept, which creates a false equivalence between spending programs and provisions of the tax code that allow people to keep greater amounts of their own income.

Here’s how I characterized this moral blindness when criticizing a Washington Post columnist back in 2013.

Hiatt presumably thinks that the government’s decision not to impose double taxation is somehow akin to a giveaway. But that only makes sense if you assume that government has a preemptive claim to all private income. …Hiatt wants us the think that there’s no moral, ethical, or economic difference between giving person A $5,000 of other people’s money and person B being…

View original 993 more words


#Obamacare chronicles: People refusing to pay the fine?

February 26, 2015
"Revenge of the angry mob"

“Revenge of the angry mob”

President Jefferson once famously said:

“I hold it that a little rebellion now and then is a good thing, and as necessary in the political world as storms in the physical.”

And maybe that “good thing” has started?

Taxpayers are already telling their accountants they plan to stiff the IRS on the Obamacare tax, saying they figure the chances the agency comes after them for a few hundred bucks are pretty slim, and it makes sense to take the risk.

Still other taxpayers are recoiling when they find out they owe far more than the $95 minimum penalty for not having insurance in 2014, said Christopher Wittich, an accountant in Minnesota.

“And that’s a big problem for them,” he said. “They don’t have 200 bucks.”

Taxpayers are facing the first round of penalties under Obamacare’s “individual mandate,” which requires most Americans to prove they have health insurance coverage or else pay the tax that the Supreme Court ruled made the law constitutional.

But Indiana accountant Scott Frick said one of his clients, told he would have to fork over $850 for going without insurance last year, thought about the IRS and decided not to pay, just to “see what happens.”

The episodes raise questions for the revenue agency, which is trying to figure out just how far it’s prepared to go to collect the Obamacare tax — and if future administrations will enforce it at all.

As I pointed out in another post, these people just finding out their 2014 penalty Shared Responsibility Payment may already owe for 2015. Surprise!

Also, I had forgotten that, as the article points out later on, the IRS is forbidden from laying criminal charges or liens against people who don’t pay the penalty. All they can do is lower their future refunds. You can bet there will be many people willing to pay that price, rather than shell out for the more expensive “affordable care” policies.

Regardless, this refusal to pay strikes me as a good thing, a sign that our spirit isn’t dead yet. I hope it catches on, and that everyone refuses to pay.

Somewhere, Mr. Jefferson smiles.

via Michael Walsh


#Obamacare Chronicles: If you paid a penalty for 2014, you may already owe one for 2015

February 24, 2015
"2014 voters"

Paid their Obamacare penalty.

I wrote before about how the Democrats are increasingly frightened of the angry mob that might rise against them once the non-coverage penalties in Obamacare start to be enforced. People who didn’t obey the mandate in 2014 will likely find themselves with smaller refunds than expected, or maybe even owing Uncle Sam. That makes for unhappy voters, who will be looking for someone to hurt. Probably the congresscritters (All Democrats) who voted for Obamacare.

But wait! There’s more!

There’s another problem. The administration’s enrollment period just ended on February 15. So if people haven’t signed up for Obamacare already, they’ll be stuck paying the higher penalty for 2015.

By the way, Democrats don’t like to call the Obamacare penalty a penalty; its official name is the Shared Responsibility Payment. But the fact is, the lawmakers’ intent in levying the fines was to make it so painful for the average American to ignore Obamacare that he or she will ultimately knuckle under and do as instructed.

Except that it’s easier to inflict theoretical pain than actual pain. Tax filing season is enlightening many Americans for the first time about the “mechanics involved” in Obamacare’s fee structure, Democratic Rep. Lloyd Doggett wrote to the Centers for Medicare and Medicaid Services on December 29. “Many taxpayers will see the financial consequences of their decision not to enroll in health insurance for the first time when they make the Shared Responsibility Payment.”

And the penalties get even larger in 2016 for those recalcitrant serfs who still refuse to obey their Betters in DC. Estimates of those range from 3-6 million people.

So Congressmen Doggett, Levin, and “Baghdad Jim” McDermott implored the administration to create a supplemental “open enrollment period” so people who didn’t buy by the 15th could do so and escape the 2015 “Shared Responsibility Payment.” And so the Democrats could escape the angry mob. This exemption comes with a stringent qualification standard, however: You have to be willing to say “I didn’t know,” and you will be magically cleansed of your sins.

The administration has done this before, granting exemptions and delays ex machina for the employer mandate with no legal authority to do so. (The ACA is very clear about its deadlines.) Now it’s an extension for open enrollment. Let’s be frank: none of these illegal waivers were granted because of sympathy for the victims. Their sole purpose is to help Democrats avoid the consequences of ramming this anti-constitutional monstrosity of a law down the throat of a nation that didn’t want it. By delaying the mandates and punishments past election day or simply granting exemptions to the latest group to complain (Oh wait! Here’s another enrollment period!), they hope to avoid the electoral whipping they so richly deserve.

That didn’t work in 2010 or 2014. Per Byron York again, no matter how it’s delayed, the voters hate the individual mandate:

The individual mandate has always been extremely unpopular. In December 2014, just a couple of months ago, the Kaiser Family Foundation found that 64 percent of those surveyed don’t like the mandate. The level of disapproval has been pretty consistent since the law was passed.

And there’s very little chance the individual mandate’s approval numbers will improve, now that millions of Americans are getting a taste of what it really means. They’re learning an essential truth of Obamacare, which is that if you don’t sign up, the IRS will make you pay.

It’s not going to work for them in 2016, either.

PS: Oh, and since we’re talking about angry mobs, let us not forget the IRS sending the wrong tax information to nearly 1,000,000 people receiving Obamacare subsidies.


#Obamacare chronicles: government sends wrong tax information to nearly 1,000,000 people

February 20, 2015
"Obamacare has arrived"

“Obamacare has arrived”

What was it Ronald Reagan said? Oh yeah:

“The nine most terrifying words in the English language are, ‘I’m from the government and I’m here to help.'”

Happy to help, America:

About 800,000 HealthCare.gov customers got the wrong tax information from the government, the Obama administration said Friday, and officials are asking those affected to delay filing their 2014 returns.

The tax mistake is a self-inflicted injury that comes on the heels of what President Barack Obama had touted as a successful enrollment season, with about 11.4 million people signed up.

California, which is running its own insurance market, on Thursday announced a similar problem affecting about 100,000 people in that state.

The errors mean that nearly 1 million people may have to wait longer to get their income tax refunds this year. And they could also affect the size of those refunds.

Another 50,000 or so who already filed may have to resubmit their returns.

My late father, a sharp man in many ways, once taught me something about handling employees:

“You can do almost anything you want to people who work for you, but you never, ever screw with their money.”

The same holds true for government and taxpayers; the Fed and California just broke that rule big-time.

Consider: We are all required by law (1) to have health insurance. If we do not, we will be punished. If our insurance is not provided by an employer, we are required, again by law, to buy it on the Obamacare exchanges. In order to afford those policies, now more expensive thanks to the “Affordable” Care Act, the government offers subsidies, the amount of which is determined by various factors, such as income and number of children. And that information has to be provided to the IRS on our tax forms, including whatever information the government provides on these new “1095” forms.  And that information in turn helps determine whether we get a refund, what size it is, or if we wind up owing the government money.

And the government gave out the wrong information.

To a million people. smiley d'oh!

It’s bad enough that people who wanted to file their return and who have almost most certainly scheduled their appointments with overworked tax-prep people will now have to delay their filings (For how long? Can they reschedule with the accountant?), but what about those who have already filed? Now they have no idea whether they get a refund or owe Uncle Sam — surprise!!

And you can bet a good portion of these one million taxpayers, most of them voters, are going to be royally ticked off about this and looking for someone to blame as we get into election season. (2)

Dad was right.

via Iowahawk:

Footnotes:
(1) This anti-constitutional monstrosity of a law, that is.
(2) That would be the Democratic Party. Not a single Republican voted for this. In fact, we were screaming like Cassandra that this was a fiasco waiting to happen. Please remember that on election day.


Welcome to tax season, now prepare to give your #Obamacare subsidy back

February 2, 2015
"Obamacare has arrived"

“Obamacare has arrived”

This item has been sitting in my files for a while (1), but, since we’re deep into tax season, it’s still relevant — especially so for people relying on that federal subsidy to help pay for their “affordable” health care:

As many as 3.4 million people who received Obamacare subsidies may owe refunds to the federal government, according to an estimate by a tax preparation firm.

H&R Block is estimating that as many as half of the 6.8 million people who received insurance premium subsidies under the Affordable Care Act benefited from subsidies that were too large, the Wall Street Journal reported Thursday.

“The ACA is going to result in more confusion for existing clients, and many taxpayers may well be very disappointed by getting less money and possibly even owing money,” the president of a tax preparation and education school told the Journal.

While the Affordable Care Act fines those who don’t have health insurance, it also provides subsidies for people making up to four times the federal poverty line ($46,680).

But the subsidies are based on past tax returns, so many people may be receiving too much, according to Vanderbilt University assistant professor John Graves, who projects the average subsidy is $208 too high, the Journal reports.

If, like a lot of people, you’re used to getting some sort of a refund, you probably already have an idea of how much you expect and how you plan to spend it. Imagine then how happy these many millions of people will be when they’re told they’re either getting less of a refund, or that they in fact owe money. And, on top of that, their subsidy for the next year will almost certainly be lower, so even more of their money will go to the insurance companies by force of law for coverage that probably isn’t as good as they had before, or at least isn’t what was promised.

That, my friends, is a recipe for angry voters. And, oh, there’s a presidential election warming up, too. Fancy that.

If anything good comes of this fiasco, it will probably be the hard-learned lesson that government is poorly equipped to do more than a certain few tasks and running a huge, massively complicated healthcare system isn’t among them.

Call it another “teachable moment.”

Footnote:
(1) Ancient by Internet standards — a whole month!

(Crossposted at Sister Toldjah)


The Case Against the IRS and the “Progressive” Income Tax

December 16, 2014

Phineas Fahrquar:

Tax reform along the lines of some sort of flat tax or a national sales tax, along with reduction in the size of government, would go a long way towards generating prosperity here again. It would also make statist heads explode — a win-win situation!

Originally posted on International Liberty:

Genuine tax reform would be the second-best fiscal policy reform to boost economic growth.*

With a simple and fair tax system, we could get rid of high tax rates that penalize productive behavior. We could eliminate the double taxation that discourages saving and investment. And we could wipe out the rat’s nest of deductions, credits, exemptions, preferences, exclusions, and other loopholes that bribe people into making economically unwise decisions.

When pushing for tax reform, I normally cite the flat tax, but there are many roads that lead to Rome. I’ve also pointed out that other tax reform plans have similar attributes. Here’s what I wrote, for instance, when comparing the flat tax and national sales tax.

In simple terms, a national sales tax (such as the Fair Tax) is like a flat tax but with a different collection point.the two plans are different…

View original 1,238 more words


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