STUMP » Articles » Obamacare Tax Watch: NYT Notices and I Spike the Ball » 22 March 2015, 06:01

Where Stu & MP spout off about everything.

Obamacare Tax Watch: NYT Notices and I Spike the Ball  


22 March 2015, 06:01

To be sure, I declared my prediction fulfilled back on February 17 with a CNN story.

We all know it takes longer for a story to get to the NY Times:

PITTSBURGH — When he signed up for health insurance through the Affordable Care Act last fall, J. C. Ciesielski estimated his income at $19,400, qualifying him for a federal subsidy that cut his premiums in half. But Mr. Ciesielski, an actor, earned an extra $2,340 from a voice-over job in December, and that welcome bit of income proved problematic when he did his taxes this month.

A tax preparer told Mr. Ciesielski that because he had not informed the federal health insurance marketplace,, of his additional income, he had to repay $118 of his subsidy. Mr. Ciesielski, who is being treated for a brain tumor, looked perplexed as he learned the money would come out of his refund check.

And people who did get insurance but, like Mr. Ciesielski, underestimated their income for 2014 — the figure on which subsidies are calculated — are being required to pay back part of their subsidy.

In late February, H & R Block reported that its uninsured clients had paid an average penalty of $172. The money comes out of refunds, while people who do not get refunds are required to pay the Internal Revenue Service by April 15.

The health law prohibits the I.R.S. from imposing criminal fines or putting liens on the property of people who ignore the insurance mandate, but it does allow the agency to collect the penalty by reducing future refunds.

H & R Block also found that as of Feb. 24, just over half of its clients with subsidized marketplace coverage had to repay a portion of their subsidy because their 2014 income turned out to be higher than what they estimated when they applied for coverage.

Kathy Pickering, executive director of the Tax Institute at H & R Block, said these clients had owed back $530 on average, decreasing their tax refund by an average of 17 percent.

“Many of them know that there’s something bad that happens when they don’t have health insurance, but they’re not quite ready for it,” said Samuel Mudrak, a volunteer tax preparer. “They’re coming in expecting to get the same refund that they got last year.”

That was the case for Mark Taylor of Carroll, Iowa, who was surprised to owe a $95 fine with his taxes because his wife, Barbara, remained uninsured last year. Other members of his family were fined, too, he said, and some were irate.

“I still don’t see the point of forcing someone to get insurance,” Ms. Kennedy said. “But I’m happy I got this taken care of for now.”

So let’s break this down. Among the H&R Block filers, they had a penalty/tax/whatever of about $172 (remember: the minimum for 2014 was $95, and it will climb to $325 for tax year 2015 and $695 for 2016 and beyond …. PER PERSON. Those are minimums.)

You think my angry taxpayer prediction will not be in play next tax season? Oh yes, it will definitely be coming back.

While yesterday’s post indicated the tax pain wasn’t enough to push people to get covered, that’s when the average tax/fee/penalty/whatever was under $200. Much less than the $395 PER PERSON we will see for 2015. And $695 PER PERSON for 2016.

Note: my prediction, made back in January, was not a difficult one to make. Especially since people have been making this prediction since Obamacare was passed five years ago.

It really shouldn’t have taken this long for the NY Times to get to this story (less than a month til Tax Day? Come on.)

But I noticed this since at least 20 years ago, when I moved to NYC — it is extremely rare for the NY Times to catch a trend early. I first noticed it in cultural trends, in that if the NYT remarked on a trend/fad, it was almost certainly over.

This is probably a reflection of the lack of diversity in their editorial staff. I mean, how many of them personally know people hit by this? It probably took a lot of time before they realized this was an issue.

And what’s hilarious about this story is the part I didn’t copy: the headline.

Jeez. They didn’t have to go with “Obamacare” in the headline, but they needed to be a little more specific than “Health Care Act”.

Don’t give us bullshit that “Affordable” is too long for the headline — could have gone with “Obamacare” instead of “Health Care Act” if they cared about pithiness.

While perhaps spiking the ball is kind of silly if the touchdown occurred over a month ago, but heck, I’ll do it just for old NYTimes’ sake.

I suppose now that the Old Grey Mare (She is Always What She Used to Be) got to it, I should retire the Obamacare Tax Watch, but I intend to keep it going as long as the stories do.

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