Obamacare

[Uncle Sam]

Obamacare

Thanks Bees.
Now I can get a good night sleep.

[Black Bart]

...A client called today asking about something I wasn't prepared for and would like some clue. He claims "he heard from his doctor" that if after 2013 a person sells a residence that would otherwise qualify for the $ 250,000 exclusion - that under this Obamacare monstrosity, there would be a 3% tax. (on what I don't know - I know no other details).
Is there any truth to this? What are the true facts to put this in proper perspective?...

See my post on this subject here: http://www.thetaxbook.com/forums/sho...ighlight=Bogus

Thanks Bees. Now I can get a good night sleep.

Don't be so sure -- my druggist says it's absolutely true. And, after all, he was smart enough to go into phramacology rather than accounting.

[OtisMozzetti]

The motives behind the law and fairness of it are irrelevant. There are all kinds of things society may feel we should do. We should buy a home. We should give money to charity. We should buy a new car and get rid of that clunker. We should buy an electric car. We should go to college. We should raise children. We should get a job, even if it doesn’t pay much and we lose our welfare benefits. We should buy health insurance.

The Court is saying the government cannot pass a law that forces us to buy a home, give to charity, buy a new car, buy an electric car, go to college, raise kids, get a job, or buy health insurance. The government can, however, encourage us to do the above by lowering or raising our taxes depending on how we respond to the above governmental directives.

There really is nothing new here. The government has been conducting social engineering ever since the passage of the 16th Amendment authorizing the government to tax our income. Nothing in that Amendment says the tax has to be equally applied to each citizen.

What about non-citizens, even non-citizens that are not lawfully present in the U.S. who file tax returns to claim refunds of withholding tax or of additional child tax credit? Will they allowed the free ride of not having to pay the individual mandate tax?

Will lawful resident aliens, green card holders, be subject to the individual mandate tax?

[Bees Knees]

What about non-citizens, even non-citizens that are not lawfully present in the U.S. who file tax returns to claim refunds of withholding tax or of additional child tax credit? Will they allowed the free ride of not having to pay the individual mandate tax?

Will lawful resident aliens, green card holders, be subject to the individual mandate tax?

From IRC §5000A...

§ 5000A(a) Requirement to maintain minimum essential coverage
An applicable individual shall for each month beginning after 2013 ensure that the individual, and any dependent of the individual who is an applicable individual, is covered under minimum essential coverage for such month.

§ 5000A(d)(1) In general
The term ‘applicable individual’ means, with respect to any month, an individual other than an individual described in paragraph (2), (3), or (4).

§ 5000A(d)(2)(A) Religious conscience exemption
Such term shall not include any individual for any month if such individual has in effect an exemption under section 1311(d)(4)(H) of the Patient Protection and Affordable Care Act …

§ 5000A(d)(3) Individuals not lawfully present
Such term shall not include an individual for any month if for the month the individual is not a citizen or national of the United States or an alien lawfully present in the United States.

§ 5000A(d)(4) Incarcerated individuals
Such term shall not include an individual for any month if for the month the individual is incarcerated, other than incarceration pending the disposition of charges.

[Jiggers]

So I read that an illegal alien does not have to have medical insurance. Like they do not now.

Yet they get benefits paid for that I don't with my health insurance policy.

Jiggers.........................you better stop while you are ahead and quit thinking............

[joanmcq]

What about non-citizens, even non-citizens that are not lawfully present in the U.S. who file tax returns to claim refunds of withholding tax or of additional child tax credit? Will they allowed the free ride of not having to pay the individual mandate tax?

Will lawful resident aliens, green card holders, be subject to the individual mandate tax?

Tax fraud is tax fraud. This is not an arguement against the ACA.

[Bees Knees]

Tax fraud is tax fraud. This is not an arguement against the ACA.

Actually it is not tax fraud for an illegal alien to file a tax return. It is actually the law that they file a tax return.

http://www.irs.gov/businesses/small/international/article/0,,id=105085,00.html

They are even entitled to tax refunds based on the income and withholding reported on their tax return, assuming everything reported is true and correct. Nowhere in the law does it say a person working illegally in this country forfeits his or her over withholding of taxes on compensation earned in the U.S.

Thus, under the new health care mandate, since illegal aliens are exempted from the insurance mandate, the tax return will have to have illegal alien status as an exception to the penalty tax for not having minimum essential coverage.

[JohnH]

laws involving fines and penalties are always enforced most aggresively against citizens who are primarily law-abiding. it's a simple cost-benefit analysis. People who have something to lose will usually pay up because they need to protect the rest of their assets against siezure.. People who have nothing to lose in the first place have no incentive to pay, and the costs (& risks) of catching them often outweigh the financial benefit to the government.

So the most effective way to raise revenue is to set up a system that traps those who have something to lose and collect from them. The others get a free ride, or perhaps some limited enforcement against them when they happen to engage in especially egregious behavior.

Just like Willie Sutton, the government knows how to go "where the money is" and that isn't the only place the analogy holds true.

[Snaggletooth]

Congratulations to Bees Knees

...not just because he is an editor, or a monitor, or anything else but one of us.

He has repeatedly brought out the fact that there is nothing new or groundbreaking about this law from the standpoint of tax formulation that goes on in our government.

And it doesn't matter whether or not he supports Obamacare or not. Personally, I think Obamacare stinks and does virtually nothing to solve any of the most germane problems in the heathcare industry. But, like he says, none of this is relevant, and it is just another episode in a long list of social tax experiments that have been going on since Day One.

[dyne]

Roberts said in his post that we preparers will possibly only have to check a box
during our interview with clients to indicate that they have health insurance. I hope
that is correct. However I am concerned that IRS may require us to PROVE that
each taxpayer has health insurance possibly by requiring us to photocopy their
health insurance card, etc. This would be a pain!

[AZ-Tax]

I did a MA return several yrs ago.

Roberts said in his post that we preparers will possibly only have to check a box
during our interview with clients to indicate that they have health insurance. I hope
that is correct. However I am concerned that IRS may require us to PROVE that
each taxpayer has health insurance possibly by requiring us to photocopy their
health insurance card, etc. This would be a pain!

I did a MA return several yrs ago and if my memory serves me correctly, I think there was a box to check.

[kpangelinan]

...not just because he is an editor, or a monitor, or anything else but one of us.

He has repeatedly brought out the fact that there is nothing new or groundbreaking about this law from the standpoint of tax formulation that goes on in our government.

And it doesn't matter whether or not he supports Obamacare or not. Personally, I think Obamacare stinks and does virtually nothing to solve any of the most germane problems in the heathcare industry. But, like he says, none of this is relevant, and it is just another episode in a long list of social tax experiments that have been going on since Day One.

Well said. And for the record, I think it stinks also! Healthcare overhaul is needed and some parts of the law are good and needed.

Roberts said in his post that we preparers will possibly only have to check a box
during our interview with clients to indicate that they have health insurance. I hope
that is correct. However I am concerned that IRS may require us to PROVE that
each taxpayer has health insurance possibly by requiring us to photocopy their
health insurance card, etc. This would be a pain!

I think that's a bit optimistic....would be nice if it was that easy. There's a little more to the tax part of the work involved when I prepare Mass returns because of the mandate in that state and it's a lot more than just checking a box, that's for sure.

[David1980]

Roberts said in his post that we preparers will possibly only have to check a box
during our interview with clients to indicate that they have health insurance. I hope
that is correct. However I am concerned that IRS may require us to PROVE that
each taxpayer has health insurance possibly by requiring us to photocopy their
health insurance card, etc. This would be a pain!

The intelligent way to handle it would be for the IRS to require some kind of reporting from the insurance providers. Surely compared to all the insurance paperwork that is required by doctors/etc... to get money from insurance companies, asking the insurance company to issue a 1099 or something with the SSN covered for the year isn't unreasonable. I think MA has a 1099-HC?

[kpangelinan]

The intelligent way to handle it would be for the IRS to require some kind of reporting from the insurance providers. Surely compared to all the insurance paperwork that is required by doctors/etc... to get money from insurance companies, asking the insurance company to issue a 1099 or something with the SSN covered for the year isn't unreasonable. I think MA has a 1099-HC?

Yes, MASS has the 1099-HC that is issued by the insurance company and additional schedules of the state return are required.

[ChEAr$]

Roberts said in his post that we preparers will possibly only have to check a box
during our interview with clients to indicate that they have health insurance. I hope
that is correct. However I am concerned that IRS may require us to PROVE that
each taxpayer has health insurance possibly by requiring us to photocopy their
health insurance card, etc. This would be a pain!

There may possibly be a form for that: Health Insurance mandate preparer checklist.!
(grin