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Obamacare Tax Penalty - 11/24/2013 6:22:29 AM   
DesideriScuri


Posts: 12225
Joined: 1/18/2012
Status: offline 		What is the reasoning behind there being a tax penalty if you aren't covered by health insurance?

Is it just a stick used to coerce you into purchasing?

If Joe Schlabotnik isn't covered by insurance, what is the $95 or 1% of his income (whichever is greater) going towards?

_____________________________

What I support:

  • A Conservative interpretation of the US Constitution
  • Personal Responsibility
  • Help for the truly needy
  • Limited Government
  • Consumption Tax (non-profit charities and food exempt)
Profile   Post #: 1
RE: Obamacare Tax Penalty - 11/24/2013 6:54:24 AM   
Yachtie


Posts: 3593
Joined: 1/18/2012
Status: offline
quote:

ORIGINAL: DesideriScuri

What is the reasoning behind there being a tax penalty if you aren't covered by health insurance?

Is it just a stick used to coerce you into purchasing?

If Joe Schlabotnik isn't covered by insurance, what is the $95 or 1% of his income (whichever is greater) going towards?



It's just a reminder of one's slave status. Nothing to see there, move along. Move along.

_____________________________

“We all know it’s going to end badly, but in the meantime we can make some money.” - Jim Cramer, CNBC

“Those who ‘abjure’ violence can only do so because others are committing violence on their behalf.” - George Orwell

(in reply to DesideriScuri)
Profile   Post #: 2
RE: Obamacare Tax Penalty - 11/24/2013 6:57:22 AM   
DesideriScuri


Posts: 12225
Joined: 1/18/2012
Status: offline
quote:

ORIGINAL: Yachtie
quote:

ORIGINAL: DesideriScuri
What is the reasoning behind there being a tax penalty if you aren't covered by health insurance?
Is it just a stick used to coerce you into purchasing?
If Joe Schlabotnik isn't covered by insurance, what is the $95 or 1% of his income (whichever is greater) going towards?

It's just a reminder of one's slave status. Nothing to see there, move along. Move along.


It's a serious question, Yachtie.

Is it just a stick used in an attempt to get us to make sure we're covered, or is there some other reason?


_____________________________

What I support:

  • A Conservative interpretation of the US Constitution
  • Personal Responsibility
  • Help for the truly needy
  • Limited Government
  • Consumption Tax (non-profit charities and food exempt)

(in reply to Yachtie)
Profile   Post #: 3
RE: Obamacare Tax Penalty - 11/24/2013 7:04:08 AM   
Yachtie


Posts: 3593
Joined: 1/18/2012
Status: offline
quote:

ORIGINAL: DesideriScuri

quote:

ORIGINAL: Yachtie
quote:

ORIGINAL: DesideriScuri
What is the reasoning behind there being a tax penalty if you aren't covered by health insurance?
Is it just a stick used to coerce you into purchasing?
If Joe Schlabotnik isn't covered by insurance, what is the $95 or 1% of his income (whichever is greater) going towards?

It's just a reminder of one's slave status. Nothing to see there, move along. Move along.


It's a serious question, Yachtie.

Is it just a stick used in an attempt to get us to make sure we're covered, or is there some other reason?




I know it is a serious question. It's obvious why the fine/tax. Everyone SHALL contribute. Whether collection can be made is quite irrelevant, as the bill due shall be there, waiting patiently. If it were truly to coerce into the system, for one's own good and that of society, the fine/tax would be greater than the cost of participating; it would have teeth.

_____________________________

“We all know it’s going to end badly, but in the meantime we can make some money.” - Jim Cramer, CNBC

“Those who ‘abjure’ violence can only do so because others are committing violence on their behalf.” - George Orwell

(in reply to DesideriScuri)
Profile   Post #: 4
RE: Obamacare Tax Penalty - 11/24/2013 7:23:54 AM   
DesideriScuri


Posts: 12225
Joined: 1/18/2012
Status: offline
quote:

ORIGINAL: Yachtie
quote:

ORIGINAL: DesideriScuri
quote:

ORIGINAL: Yachtie
quote:

ORIGINAL: DesideriScuri
What is the reasoning behind there being a tax penalty if you aren't covered by health insurance?
Is it just a stick used to coerce you into purchasing?
If Joe Schlabotnik isn't covered by insurance, what is the $95 or 1% of his income (whichever is greater) going towards?

It's just a reminder of one's slave status. Nothing to see there, move along. Move along.

It's a serious question, Yachtie.
Is it just a stick used in an attempt to get us to make sure we're covered, or is there some other reason?

I know it is a serious question. It's obvious why the fine/tax. Everyone SHALL contribute. Whether collection can be made is quite irrelevant, as the bill due shall be there, waiting patiently. If it were truly to coerce into the system, for one's own good and that of society, the fine/tax would be greater than the cost of participating; it would have teeth.


What is that "contribution" going towards? Is there a tax involved in the purchase of insurance that isn't being paid if we're not purchasing insurance? Is that what the penalty covers?

There is the claim that people not purchasing insurance makes health care more expensive for everyone. That may be true, if one gets charity care, but isn't true if one does not get health care during that year. If I didn't have any prescriptions filled and didn't go to the Dr. for anything, treating all my medical care needs with over-the-counter medications and/or self-administered First Aid, paid for out of my pocket, how did my not purchasing insurance increase anyone's costs?

Did I increase government's medical care costs? Of course not. Their costs are already negotiated and don't change upon my entry into the private insurance Market. Private insurance, I have read, sets reimbursements based on Medicare's reimbursement schedules, so those costs aren't really touched by my entry into or exit from the insurance Market, either.

A healthy person is supposed to purchase insurance that he or she may not want, and that coverage may include things that he or she may not physically be at risk of needing. They are supposed to do this to add to the premium pool to reduce the impact of entry of those who are sicker or who have pre-existing conditions.

Non-entry into the Market reduces those spread of premium costs, forcing insurers to charge more to those who are in the Market. So, my entry or non-entry is really only going to impact other Citizens.


_____________________________

What I support:

  • A Conservative interpretation of the US Constitution
  • Personal Responsibility
  • Help for the truly needy
  • Limited Government
  • Consumption Tax (non-profit charities and food exempt)

(in reply to Yachtie)
Profile   Post #: 5
RE: Obamacare Tax Penalty - 11/24/2013 7:27:36 AM   
DomKen


Posts: 19457
Joined: 7/4/2004
From: Chicago, IL
Status: offline
quote:

ORIGINAL: DesideriScuri

What is the reasoning behind there being a tax penalty if you aren't covered by health insurance?

Is it just a stick used to coerce you into purchasing?

If Joe Schlabotnik isn't covered by insurance, what is the $95 or 1% of his income (whichever is greater) going towards?

The idea is to get everyone to buy health insurance. The reasoning goes that no one will want to pay the fine so they'll go out and get health insurance.

(in reply to DesideriScuri)
Profile   Post #: 6
RE: Obamacare Tax Penalty - 11/24/2013 7:34:15 AM   
Yachtie


Posts: 3593
Joined: 1/18/2012
Status: offline
quote:

ORIGINAL: DesideriScuri

What is that "contribution" going towards? Is there a tax involved in the purchase of insurance that isn't being paid if we're not purchasing insurance? Is that what the penalty covers?

There is the claim that people not purchasing insurance makes health care more expensive for everyone. That may be true, if one gets charity care, but isn't true if one does not get health care during that year.



It's obvious, Desi. How are insurance companies profitable? Because more pay in than what gets paid out. The ACA is designed for those needing insurance. A healthy 20 something doesn't need insurance, except for the ruberic of "what if," which you and I know is a specious argument.

The ACA will, from its onset or soon after, have a higher payout than intake unless those who's need is specious participate. It's forcing me, who's not in need, to help your aunt Mary who is.

Forget about getting caught up in the dollars and cents bullshit. It's a scheme, with a little Ponzi in it too.


_____________________________

“We all know it’s going to end badly, but in the meantime we can make some money.” - Jim Cramer, CNBC

“Those who ‘abjure’ violence can only do so because others are committing violence on their behalf.” - George Orwell

(in reply to DesideriScuri)
Profile   Post #: 7
RE: Obamacare Tax Penalty - 11/24/2013 7:36:25 AM   
RottenJohnny


Posts: 1677
Joined: 5/5/2006
Status: offline
quote:

ORIGINAL: DesideriScuri

What is the reasoning behind there being a tax penalty if you aren't covered by health insurance?

Is it just a stick used to coerce you into purchasing?

If Joe Schlabotnik isn't covered by insurance, what is the $95 or 1% of his income (whichever is greater) going towards?

In my view, it's the fee you have to pay to actually exercise your freedom to not participate in a social program...which is exactly why the ACA offends me so much. How do you justify making people pay for their freedom in a country that supposedly recognizes it as a human right?

_____________________________

"I find your arguments strewn with gaping defects in logic." - Mr. Spock

"Give me liberty or give me death." - Patrick Henry

I believe in common sense, not common opinions. - Me

(in reply to DesideriScuri)
Profile   Post #: 8
RE: Obamacare Tax Penalty - 11/24/2013 7:53:58 AM   
DesideriScuri


Posts: 12225
Joined: 1/18/2012
Status: offline
quote:

ORIGINAL: RottenJohnny
quote:

ORIGINAL: DesideriScuri
What is the reasoning behind there being a tax penalty if you aren't covered by health insurance?
Is it just a stick used to coerce you into purchasing?
If Joe Schlabotnik isn't covered by insurance, what is the $95 or 1% of his income (whichever is greater) going towards?

In my view, it's the fee you have to pay to actually exercise your freedom to not participate in a social program...which is exactly why the ACA offends me so much. How do you justify making people pay for their freedom in a country that supposedly recognizes it as a human right?


But, what is that penalty going to be used for?


_____________________________

What I support:

  • A Conservative interpretation of the US Constitution
  • Personal Responsibility
  • Help for the truly needy
  • Limited Government
  • Consumption Tax (non-profit charities and food exempt)

(in reply to RottenJohnny)
Profile   Post #: 9
RE: Obamacare Tax Penalty - 11/24/2013 7:55:59 AM   
DesideriScuri


Posts: 12225
Joined: 1/18/2012
Status: offline
quote:

ORIGINAL: DomKen
quote:

ORIGINAL: DesideriScuri
What is the reasoning behind there being a tax penalty if you aren't covered by health insurance?
Is it just a stick used to coerce you into purchasing?
If Joe Schlabotnik isn't covered by insurance, what is the $95 or 1% of his income (whichever is greater) going towards?

The idea is to get everyone to buy health insurance. The reasoning goes that no one will want to pay the fine so they'll go out and get health insurance.


So, it's just a stick.

But, what is that penalty going to fund?


_____________________________

What I support:

  • A Conservative interpretation of the US Constitution
  • Personal Responsibility
  • Help for the truly needy
  • Limited Government
  • Consumption Tax (non-profit charities and food exempt)

(in reply to DomKen)
Profile   Post #: 10
RE: Obamacare Tax Penalty - 11/24/2013 8:38:26 AM   
RottenJohnny


Posts: 1677
Joined: 5/5/2006
Status: offline
quote:

ORIGINAL: DesideriScuri

quote:

ORIGINAL: RottenJohnny
quote:

ORIGINAL: DesideriScuri
What is the reasoning behind there being a tax penalty if you aren't covered by health insurance?
Is it just a stick used to coerce you into purchasing?
If Joe Schlabotnik isn't covered by insurance, what is the $95 or 1% of his income (whichever is greater) going towards?

In my view, it's the fee you have to pay to actually exercise your freedom to not participate in a social program...which is exactly why the ACA offends me so much. How do you justify making people pay for their freedom in a country that supposedly recognizes it as a human right?


But, what is that penalty going to be used for?


Just a guess but I expect it's going to be put into the general spending fund.

_____________________________

"I find your arguments strewn with gaping defects in logic." - Mr. Spock

"Give me liberty or give me death." - Patrick Henry

I believe in common sense, not common opinions. - Me

(in reply to DesideriScuri)
Profile   Post #: 11
RE: Obamacare Tax Penalty - 11/24/2013 9:45:55 AM   
DesideriScuri


Posts: 12225
Joined: 1/18/2012
Status: offline
quote:

ORIGINAL: RottenJohnny
quote:

ORIGINAL: DesideriScuri
But, what is that penalty going to be used for?

Just a guess but I expect it's going to be put into the general spending fund.


So, it's not really doing anything regarding health care.


_____________________________

What I support:

  • A Conservative interpretation of the US Constitution
  • Personal Responsibility
  • Help for the truly needy
  • Limited Government
  • Consumption Tax (non-profit charities and food exempt)

(in reply to RottenJohnny)
Profile   Post #: 12
RE: Obamacare Tax Penalty - 11/24/2013 9:52:41 AM   
OsideGirl


Posts: 14442
Joined: 7/1/2005
From: United States
Status: offline
quote:

ORIGINAL: DomKen


quote:

ORIGINAL: DesideriScuri

What is the reasoning behind there being a tax penalty if you aren't covered by health insurance?

Is it just a stick used to coerce you into purchasing?

If Joe Schlabotnik isn't covered by insurance, what is the $95 or 1% of his income (whichever is greater) going towards?

The idea is to get everyone to buy health insurance. The reasoning goes that no one will want to pay the fine so they'll go out and get health insurance.


We're seriously considering just paying the fine.

The cheapest coverage offered to us is $700 per month X12 = $7200.00. Now that plan which we're paying $700 a month for has a $10,000 deductible. So, since we haven't hit $10,000 in medical bills in 15 years...chances are that we're paying $700 and not getting any coverage.

We're thinking that it may just be best to pay the $1000.00 fine and put the remaining $6200 into a managed care account and actually have that money go towards our medical bills.

_____________________________

Give a girl the right shoes and she will conquer the world. ~ Marilyn Monroe

The Accelerated Velocity of Terminological Inexactitude

(in reply to DomKen)
Profile   Post #: 13
RE: Obamacare Tax Penalty - 11/24/2013 10:35:31 AM   
Phydeaux


Posts: 4828
Joined: 1/4/2004
Status: offline
quote:

ORIGINAL: OsideGirl


quote:

ORIGINAL: DomKen


quote:

ORIGINAL: DesideriScuri

What is the reasoning behind there being a tax penalty if you aren't covered by health insurance?

Is it just a stick used to coerce you into purchasing?

If Joe Schlabotnik isn't covered by insurance, what is the $95 or 1% of his income (whichever is greater) going towards?

The idea is to get everyone to buy health insurance. The reasoning goes that no one will want to pay the fine so they'll go out and get health insurance.


We're seriously considering just paying the fine.

The cheapest coverage offered to us is $700 per month X12 = $7200.00. Now that plan which we're paying $700 a month for has a $10,000 deductible. So, since we haven't hit $10,000 in medical bills in 15 years...chances are that we're paying $700 and not getting any coverage.

We're thinking that it may just be best to pay the $1000.00 fine and put the remaining $6200 into a managed care account and actually have that money go towards our medical bills.


Yep, thats the logical thing - put as much as possible into an HSA, and put the rest into assets that yield a return.

Alternately, get with a group of people and self insure. That form of insurance hasn't been hit yet. Make a figure head company. Get 30 people.

Have the company purchase catastrophic insurance.

Now there are two ways to go:

Shell game - just to avoid obamacare penalty - since employers dont' have to actually provide insurance that meets the standard yet.

Or alternately
get real insurance (not aca insurance) and run the expence through the llc.


(in reply to OsideGirl)
Profile   Post #: 14
RE: Obamacare Tax Penalty - 11/24/2013 10:58:07 AM   
RottenJohnny


Posts: 1677
Joined: 5/5/2006
Status: offline
quote:

ORIGINAL: DesideriScuri

quote:

ORIGINAL: RottenJohnny
quote:

ORIGINAL: DesideriScuri
But, what is that penalty going to be used for?

Just a guess but I expect it's going to be put into the general spending fund.


So, it's not really doing anything regarding health care.


Not specifically. But if it goes into the general fund and costs associated with the ACA are paid out of the general fund then it actually would be paying for some aspect of health care.

_____________________________

"I find your arguments strewn with gaping defects in logic." - Mr. Spock

"Give me liberty or give me death." - Patrick Henry

I believe in common sense, not common opinions. - Me

(in reply to DesideriScuri)
Profile   Post #: 15
RE: Obamacare Tax Penalty - 11/24/2013 12:34:06 PM   
BitaTruble


Posts: 9779
Joined: 1/12/2006
From: Texas
Status: offline
quote:

ORIGINAL: DesideriScuri

What is the reasoning behind there being a tax penalty if you aren't covered by health insurance?


To help states off-set the costs of exchanges.

quote:

Is it just a stick used to coerce you into purchasing?


Of course, otherwise healthy people wouldn't buy insurance.

quote:

If Joe Schlabotnik isn't covered by insurance, what is the $95 or 1% of his income (whichever is greater) going towards?

The money goes into a special fund which will be overseen by the Sec of Treas - specifically, according to the ACA text, money collected will be divided among the states who have set up exchanges to help offset the cost of setting up/running the exchanges. Each of the 50 states will be allocated a % of the money based on certain criteria and may only be used for specific costs associated with setting up and running the exchanges.

The max penalty is the greater of 1% of income (not to exceed three times the mandate fee for any given individual) or $95 for the first year. $95 x 3 = $285 per person max for 2014. This fee must be paid with your federal return no later than April 15th, 2015.

There are many exceptions to get around paying the fee but refusing to answer the question on the tax form of whether or not you even had insurance yields an automatic fee of $1000 per incident. That makes it cheaper to pay the fee than to refuse to answer the question on the new federal tax forms.

The easiest exemption for most Americans is to just let one of their utility bills lapse for a month so they get a shut-off notice then pay their bill before they get disconnected. Shut-off notice proves hardship exemption but utility companies only notify credit reporting companies of disconnects, not over-due bills so it doesn't effect your credit either... and .. it's not illegal.

I'm sure there will be attempts to put regulations put into place so that doesn't happen in the future.. but for 2014, it's pretty much a free ride to avoid paying any fees.













_____________________________

"Oh, so it's just like
Rock, paper, scissors."

He laughed. "You are the wisest woman I know."


(in reply to DesideriScuri)
Profile   Post #: 16
RE: Obamacare Tax Penalty - 11/24/2013 1:10:53 PM   
DesideriScuri


Posts: 12225
Joined: 1/18/2012
Status: offline
quote:

ORIGINAL: BitaTruble
quote:

ORIGINAL: DesideriScuri
What is the reasoning behind there being a tax penalty if you aren't covered by health insurance?

To help states off-set the costs of exchanges.


It's not paid to the States. It goes to the Federal Government.

quote:

quote:

Is it just a stick used to coerce you into purchasing?

Of course, otherwise healthy people wouldn't buy insurance.


As Yachtie noted, it's a pittance, really. Someone making $40k will pay $400, unless the cost of an acceptable policy is cheaper. For someone who is healthy, it might be worth the "gamble" to not buy insurance.

quote:

quote:

If Joe Schlabotnik isn't covered by insurance, what is the $95 or 1% of his income (whichever is greater) going towards?

The money goes into a special fund which will be overseen by the Sec of Treas - specifically, according to the ACA text, money collected will be divided among the states who have set up exchanges to help offset the cost of setting up/running the exchanges. Each of the 50 states will be allocated a % of the money based on certain criteria and may only be used for specific costs associated with setting up and running the exchanges.
The max penalty is the greater of 1% of income (not to exceed three times the mandate fee for any given individual) or $95 for the first year. $95 x 3 = $285 per person max for 2014. This fee must be paid with your federal return no later than April 15th, 2015.
There are many exceptions to get around paying the fee but refusing to answer the question on the tax form of whether or not you even had insurance yields an automatic fee of $1000 per incident. That makes it cheaper to pay the fee than to refuse to answer the question on the new federal tax forms.
The easiest exemption for most Americans is to just let one of their utility bills lapse for a month so they get a shut-off notice then pay their bill before they get disconnected. Shut-off notice proves hardship exemption but utility companies only notify credit reporting companies of disconnects, not over-due bills so it doesn't effect your credit either... and .. it's not illegal.
I'm sure there will be attempts to put regulations put into place so that doesn't happen in the future.. but for 2014, it's pretty much a free ride to avoid paying any fees.


Thanks for the info. I haven't seen the 3x part before. I thought the initial year was the greater of $95 or 1% of your income.


_____________________________

What I support:

  • A Conservative interpretation of the US Constitution
  • Personal Responsibility
  • Help for the truly needy
  • Limited Government
  • Consumption Tax (non-profit charities and food exempt)

(in reply to BitaTruble)
Profile   Post #: 17
RE: Obamacare Tax Penalty - 11/24/2013 5:01:19 PM   
LookieNoNookie


Posts: 12216
Joined: 8/9/2008
Status: offline
quote:

ORIGINAL: DesideriScuri

What is the reasoning behind there being a tax penalty if you aren't covered by health insurance?

Is it just a stick used to coerce you into purchasing?

If Joe Schlabotnik isn't covered by insurance, what is the $95 or 1% of his income (whichever is greater) going towards?


It's kind of like those penalties that the banks pay (as in the current 13 billion for whichever one it is). In the general fund.

Doesn't go anywhere you'd imagine it should.

I've said for years....ACA was never about getting health care to the masses...it was a recognition that the slush bucket (SSI) was running out of cash and, this was a new place where they could create a brand new bucket to dip into and tell us in 20 years..."we fucked up....we didn't anticipate____________________ and, well...it's gonna cost a LOT more....but....we have a fix....just another 1.25% deducted out of your paychecks and....all is well for another 75 years....honest!!!"

And then....in about 15 more years...."we fucked up....we didn't anticipate____________________ and, well...it's gonna cost a LOT more....but....we have a fix....just another 2.75% deducted out of your paychecks and....all is well for another 75 years....honest!!!"

And then....in about 15 more years...."we fucked up....we didn't anticipate____________________ and, well...it's gonna cost a LOT more....but....we have a fix....just another 4.75% deducted out of your paychecks and....all is well for another 75 years....honest!!!"

Government toilet seats and hammers just ain't cheap.

(in reply to DesideriScuri)
Profile   Post #: 18
RE: Obamacare Tax Penalty - 11/24/2013 5:03:15 PM   
LookieNoNookie


Posts: 12216
Joined: 8/9/2008
Status: offline
quote:

ORIGINAL: DesideriScuri

quote:

ORIGINAL: DomKen
quote:

ORIGINAL: DesideriScuri
What is the reasoning behind there being a tax penalty if you aren't covered by health insurance?
Is it just a stick used to coerce you into purchasing?
If Joe Schlabotnik isn't covered by insurance, what is the $95 or 1% of his income (whichever is greater) going towards?

The idea is to get everyone to buy health insurance. The reasoning goes that no one will want to pay the fine so they'll go out and get health insurance.


So, it's just a stick.

But, what is that penalty going to fund?



:)

Not at all what they tell you it will fund :)

(in reply to DesideriScuri)
Profile   Post #: 19
RE: Obamacare Tax Penalty - 11/24/2013 5:04:16 PM   
LookieNoNookie


Posts: 12216
Joined: 8/9/2008
Status: offline
quote:

ORIGINAL: DesideriScuri

quote:

ORIGINAL: RottenJohnny
quote:

ORIGINAL: DesideriScuri
But, what is that penalty going to be used for?

Just a guess but I expect it's going to be put into the general spending fund.


So, it's not really doing anything regarding health care.



Newp.

Never was planned to do that :)

(in reply to DesideriScuri)
Profile   Post #: 20
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