“Understand the new health-care provisions. Under the Affordable Care Act, filers this year must check a box on Line 61 on the 1040 form if they had approved health-care coverage for all of 2014, or possibly pay a penalty if they didn’t. The instructions for Form 8965 explain how to calculate the penalty.
Employers aren’t required to provide evidence of ACA-approved insurance to employees until the 2015 tax year.
Last year, several million people received an upfront tax credit to help them buy insurance, and they could owe more tax now if their income was larger than expected or less if it was smaller than expected. According to estimates by the Kaiser Family Foundation, about half of tax-credit recipients will need to make a repayment that averages $794 for 2014, while about 45% will get back an average of $773. The average refund for all taxpayers is currently $2,893.
In February, the Department of Health and Human Services said it sent erroneous forms to about 800,000 tax-credit recipients living in 37 states. People who already had filed returns using the erroneous information were given a free pass by the IRS, but the rest have been told to wait for corrected forms before filing.
Millions of people also qualify for exemptions from required ACA coverage. They need to attach a Form 8965 to this year’s return.” - Last-Minute Tax Moves, wsj.com, 03/27/2015.
Link to the article appears below:
http://www.wsj.com/articles/last-minute-tax-moves-1427460256?KEYWORDS=weekend+investor
“Several million people hit with new federal fines for going without health insurance will get a second chance to sign up starting Sunday, and that could ease the sting of rising penalties.
But, as the enrollment window reopens, it’s unclear how many know about the time-limited opportunity, let alone will take advantage of it.
Fines payable to the IRS are the stick behind the offer of taxpayer-subsidized private insurance under President Barack Obama’s health care law. Virtually everyone in the country is now required to have coverage through an employer or a government program, or by buying individual policies.
This is the first year fines are being collected from uninsured people the government deems able to afford coverage. Tax preparation company H&R Block says the penalty averages about $170 among its affected customers. It usually is deducted from a person’s tax refund.
Those penalized are mainly the kind of people the law was intended to help: low- and middle-income workers who do not have coverage on the job or are self-employed. Roughly 4 million people are expected to pay fines, according to congressional estimates. Many more will qualify for exemptions.”
“Penalties for being uninsured are going up this year to a minimum of $325 for the full 12 months. That’s a significant increase from the $95 minimum in 2014.
The new sign-up opportunity runs through April 30. To qualify, individuals have to certify to the government that they meet certain conditions, including:
– They did not know or understand that they were legally required to have coverage until after open enrollment officially ended Feb. 15.
– They owed a penalty for being uninsured in 2014.
Those requirements are for the 37 states served by the federal HealthCare.gov website. States running their own insurance exchanges may have different rules and deadlines. Penalties for 2014 are not refundable.” - Cool reception for new ACA sign-up window, Albuquerque Journal, 03/15/2015
Link to the entire article appears below:
http://www.abqjournal.com/555733/news/cool-reception-for-new-aca-signup-window.html
“Opponents of the federal health-care law can move forward with a lawsuit challenging some subsidies for people who buy health insurance, but the financial assistance will remain in place while the case proceeds, a federal judge said Tuesday.”
“Under the 2010 Affordable Care Act, most Americans must carry health insurance or face a tax penalty. To ease the financial burden, the law provided for subsidies to make coverage more affordable to low- and middle-income individuals.
The plaintiffs in the lawsuit include four people who don’t want to buy the level of health insurance required by the law.
The act says people can qualify for subsidies if they buy health insurance through an exchange “established by the state.” A majority of states, however, chose not to set up their own marketplaces, leaving the federal government to run some or all of the exchanges in 36 states.
The challengers contend the subsidies don’t apply to consumers who buy insurance through federally run exchanges. And they say the Internal Revenue Service contravened the text of the law when it said last year that the subsidies would be available to individuals who bought insurance on either type of exchange.
The Justice Department, defending the law in court, argued Congress plainly intended for the subsidies to be available to all consumers. The department said challengers shouldn’t be allowed to proceed with a legal effort that runs counter to the law’s aim of making insurance affordable.” - Judge Allows Suit Challenging Health-Law Subsidies, WSJ, 10/22/2013
“Under the Affordable Care Act, subsidies are only available for state exchanges. But through regulation the Internal Revenue Service has extended subsidies to federal exchanges too.”
The text of the Affordable Care Act states that people who buy health insurance from state exchanges get subsidies if they earn under 400% of the poverty line, currently $94,000 for a family of four. Most applicants will qualify for some subsidy.
According to the law, subsidies are available to those who get their health insurance “through an Exchange established by the State under section 1311 of the Patient Protection and Affordable Care Act.” Or, in another section, those “enrolled in through (sic) an Exchange established by the State under section 1311.”
Congress put state subsidies in place to encourage states to set up exchanges. Still, only 16 states and the District of Columbia took the carrot and set them up, fewer than anticipated.
A different section of the act (Section 1321) allows the federal government to set up exchanges in states that have not done so. It is these federal exchanges that have made headlines due to their technical problems. But nowhere does the law say that people on these federal exchanges can receive tax subsidies.
No problem, said the IRS in a May 2012 ruling. The IRS extended the subsidies to those getting health insurance on any exchange by defining an exchange as a “State Exchange, regional Exchange, subsidiary Exchange, and Federally-facilitated Exchange.”
This IRS ruling may have had the unintended consequence of discouraging states from setting up exchanges. States had nothing to gain, and a lot to lose, if the exchanges did not work efficiently. Governors may well have calculated that if Uncle Sam were going to set up exchanges and give their residents the same level of subsidy, why set up their own exchanges? If problems occur, as is happening now, the federal government takes the blame, not the governor or Legislature.
Two groups of Virginia and District of Columbia residents are suing the government, arguing that extending the subsidies to federal exchanges puts them at a disadvantage.
Without the subsidy, their attorneys argue, the cost of health insurance would be greater than 8% of their income, meeting the definition of unaffordable coverage. This would enable them to receive a certificate of exemption from the requirement to purchase health insurance. It would also enable them to buy catastrophic health insurance, low-cost insurance against major illness.
Otherwise, lower cost catastrophic health insurance is only available to those under 30 years of age.
In response, the Department of Justice stated that the law is ambiguous, so the IRS had the right to extend subsidies to the federal exchanges. Plus, the government attorneys say, the plaintiffs are not being hurt by being provided with subsidized insurance. With the subsidies in the federal exchanges, the plaintiffs would pay $20 monthly for insurance, rather than hundreds of dollars monthly for catastrophic health insurance.
Judge Friedman disagreed with the Justice Department. Ruling from the bench, he denied the request for a preliminary injunction to block the subsidies, but made it clear that he understands the timing and intends to expedite the case to final judgment. That is the ideal approach, because it means he will rule on the merits by mid-February, and whoever loses can appeal to the D.C. Circuit Court of Appeals.
The denial of the government’s motion to dismiss was the important development, because the government was desperate to avoid having any court consider the merits of the case. However Friedman and Spencer resolve the issue, it will ultimately be up to the appellate court (or Supreme Court) to decide. This week’s actions ensure that will happen in the next two months, rather than in six months, or a year, or in 2017 (as the government wanted).
One major question is spending authority. If Congress did not authorize subsidies for federal exchanges, does the IRS have the right to spend the money? - Court could block Obamacare subsidies in 34 states, WSJ, Market Watch, 10/25/2013
Link to the above articles appear below:
http://online.wsj.com/news/articles/SB10001424052702303448104579151511784321686?mod=wsj_streaming_stream
http://www.marketwatch.com/story/court-could-block-obamacare-subsidies-in-34-states-2013-10-25?link=MW_story_popular
"You'll have to get coverage by Valentine's Day or thereabouts to avoid penalties for being uninsured, the Obama administration confirmed Wednesday.
That's about six weeks earlier than a Mar. 31 deadline often cited previously.”
“The Jackson Hewitt tax preparation company first pointed out the wrinkle with the health care law's least popular requirement.
An administration official confirmed it. The official spoke on condition of anonymity because they were not authorized to speak publicly.
It's the latest tweak involving complex requirements of President Barack Obama's health care law, known as the Affordable Care Act. Previous adjustments have ranged from the momentous to the mundane. The biggest one was a one-year delay of a requirement that larger employers offer coverage, announced this summer. More recently, the administration has postponed some Spanish-language capabilities of its enrollment website, as well as full functionality on the site small businesses use to sign up.
Brian Haile, senior vice president for health policy at Jackson Hewitt, said government agencies initially had different interpretations of the enrollment deadline. The Health and Human Services department, which is taking the lead in implementing the law, kept referring to a Mar. 31 deadline. But the Internal Revenue Service, which handles most of the financial aspects, suggested that the deadline had to be in February.
"There were inconsistencies," said Haile, adding it took several inquiries by Jackson Hewitt over the last few weeks to clear up the uncertainty.” - Administration: Penalties for Obamacare Kick in on Valentine's Day, Newsmax, 10/09/2013
Link to entire article appears below:
http://www.newsmax.com/Newsfront/US-Health-Overhaul-Penalties/2013/10/09/id/530156?ns_mail_uid=62439580&ns_mail_job=1540953_10092013&promo_code=1521C-1
“The Obama administration announced Friday that it would significantly scale back the health law’s requirements that new insurance marketplaces verify consumers’ income and health insurance status.
Instead, the federal government will rely more heavily on consumers’ self-reported information until 2015, when it plans to have stronger verification systems in place.”
“After encountering “legislative and operational barriers,” the federal government will not require the District and the 16 states that are running their own marketplaces to verify a consumer’s statement that they do not receive health insurance from their employer.
“The exchange may accept the applicant’s attestation regarding enrollment in eligible employer-sponsored plan . . . without further verification,” according to the final rule.
The federal government will, however, conduct an audit for the states where it is managing the new insurance Web portal.
The rule also scaled back states’ responsibilities to double-check the income levels that consumers report, which determine any tax subsidy they receive.” - Health insurance marketplaces will not be required to verify consumer claims, Washington Post, O7/05/2013
The entire article appears in the link below:
http://www.washingtonpost.com/national/health-science/health-insurance-marketplaces-will-not-be-required-to-verify-consumer-claims/2013/07/05/d2a171f4-e5ab-11e2-aef3-339619eab080_story.html
"The Internal Revenue Service official in charge of the tax-exempt organizations at the time when the unit targeted tea party groups now runs the IRS office responsible for the health care legislation.
Sarah Hall Ingram served as commissioner of the office responsible for tax-exempt organizations between 2009 and 2012. But Ingram has since left that part of the IRS and is now the director of the IRS’ Affordable Care Act office, the IRS confirmed to ABC News today.
Her successor, Joseph Grant, is taking the fall for misdeeds at the scandal-plagued unit between 2010 and 2012. During at least part of that time, Grant served as deputy commissioner of the tax-exempt unit.
Grant announced today that he would retire June 3, despite being appointed as commissioner of the tax-exempt office May 8, a week ago.” - IRS Official in Charge During Tea Party Targeting Now Runs Health Care Office, John Parkinson, ABC News, 05/16/2013
Link to the entire ABC article appears below:
http://abcnews.go.com/blogs/politics/2013/05/irs-official-in-charge-during-tea-party-targeting-now-runs-health-care-office/
