Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
ACA Tax Penalty
Old 01-19-2015, 06:15 AM   #1
Thinks s/he gets paid by the post
imoldernu's Avatar
 
Join Date: Jul 2012
Location: Peru
Posts: 4,616
ACA Tax Penalty

From Washington Post:
Quote:
Those Americans who didnít get health insurance last year could be in for a rude awakening when the IRS asks them to fork over their Obamacare penalty ó and it could be a lot more than the $95 many of them may be expecting.

The Affordable Care Act requires those who didnít have insurance last year and didnít qualify for one of the exemptions to pay a tax penalty, which was widely cited as $95 the first year. But the $95 is actually a minimum, and middle- and upper-income families will actually end up paying 1 percent of their household income as their penalty.

TurboTax, an online tax service, estimated that the average penalty for lacking health insurance in 2014 will be $301.Obamacare penalty may come as shock at tax time - Washington Times
Thismay have been posted... didn't see it.
__________________

__________________
imoldernu is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 01-19-2015, 06:21 AM   #2
Thinks s/he gets paid by the post
 
Join Date: Mar 2011
Posts: 3,702
Still, for a lot of people, even a $300 fine is a lot better deal than $1200 a month. They can still do what they've always done: go to the ER if they have to and if they're fairly healthy otherwise, come out ahead.

Personally I have, like and NEED health insurance, but if I was 28 y.o. and was just above the subsidy cliff, I'd really, really think about just paying the fine.
__________________

__________________
Living well is the best revenge!
Retired @ 52 in 2005
marko is offline   Reply With Quote
Old 01-19-2015, 06:36 AM   #3
Thinks s/he gets paid by the post
2B's Avatar
 
Join Date: Mar 2006
Location: Houston
Posts: 4,330
The problem with going to the ER is that any assets you have are subject to "collection." You can't just go there, get treatment and say "bye." They will come after you so it's only viable for people that are truly without assets or jobs.

The problem I see is that many people, even with their subsidies, do not want to divert the cash needed to pay their portion of the premium or copays required from where its currently going. This could be anything from their essential I-phone 6 or their utilities. I'm not in a position to generalize but other expenses are more important in their minds.

These penalties will continue to grow. This year's impact will be a wake up call but most will just grumble.

The primary beneficiaries of the ACA are members of this forum. Most of us consider heath insurance a necessity. We would buy it anyway. The ACA guarantees we can get a policy. Having assets doesn't keep us from getting the subsidy by controlling our taxable income. It encourages the potential early retiree with ample resources to retire earlier. It does very little for the people that don't have heath insurance as one of their priorities.
__________________
The object of life is not to be on the side of the majority, but to escape finding oneself in the ranks of the insane -- Marcus Aurelius
2B is offline   Reply With Quote
Old 01-19-2015, 07:14 AM   #4
Thinks s/he gets paid by the post
 
Join Date: Mar 2011
Posts: 3,702
Quote:
Originally Posted by 2B View Post
The primary beneficiaries of the ACA are members of this forum.

Having assets doesn't keep us from getting the subsidy by controlling our taxable income. It encourages the potential early retiree with ample resources to retire earlier. It does very little for the people that don't have heath insurance as one of their priorities.
Eggs...actly!

As my accountant once told me: "The trick is to look like one of them on paper while being one of us" He was talking about taxes, but it applies here as well
__________________
Living well is the best revenge!
Retired @ 52 in 2005
marko is offline   Reply With Quote
Old 01-19-2015, 08:34 AM   #5
Full time employment: Posting here.
 
Join Date: Aug 2014
Posts: 555
I agree we benefit since they count income but not assets but worry how long that will last. LBYMers are an unprotected minority group and an easy target since we "don't really need the subsidy".

I disagree that we are the "primary beneficiaries of the ACA". I think that would be hospitals and insurance companies. I hear that the number of uninsured has dropped at most hospital emergency rooms in my state. I have yet to hear that hospital prices have dropped since they no longer have to write off those bills.
__________________
ArkTinkerer is offline   Reply With Quote
Old 01-24-2015, 03:08 PM   #6
Recycles dryer sheets
 
Join Date: Dec 2006
Posts: 408
What bothers me, is the PRESS, always emphasized the $95 penalty.


When it was well know, it was the HIGHER, $95 or 1%.


For 2015 tax year it worse. $325 or 2%, which ever is higher.
__________________
wolf is offline   Reply With Quote
Old 01-24-2015, 09:10 PM   #7
Thinks s/he gets paid by the post
heeyy_joe's Avatar
 
Join Date: Nov 2012
Location: Madeira Beach Fl
Posts: 1,403
No worries until 2017...
__________________
_______________________________________________
"A man is a success if he gets up in the morning and goes to bed at night and in between does what he wants to do" --Bob Dylan.
heeyy_joe is offline   Reply With Quote
Old 01-24-2015, 09:55 PM   #8
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
clifp's Avatar
 
Join Date: Oct 2006
Posts: 7,450
Quote:
Originally Posted by marko View Post
Still, for a lot of people, even a $300 fine is a lot better deal than $1200 a month. They can still do what they've always done: go to the ER if they have to and if they're fairly healthy otherwise, come out ahead.

Personally I have, like and NEED health insurance, but if I was 28 y.o. and was just above the subsidy cliff, I'd really, really think about just paying the fine.

Actually from my understanding is you don't even need to pay the fine.

Just make sure your withholding is slightly less than the taxes you owe, and then pay the additional taxes, come April, but don't pay the fine.

Personally I wouldn't do that but it appears that IRS is not allowed to garnish wages or attach bank accounts to collect unpaid ACA fines.
__________________
clifp is offline   Reply With Quote
Old 01-24-2015, 10:01 PM   #9
Thinks s/he gets paid by the post
 
Join Date: Feb 2014
Posts: 1,471
Quote:
Originally Posted by marko View Post
Still, for a lot of people, even a $300 fine is a lot better deal than $1200 a month. They can still do what they've always done: go to the ER if they have to and if they're fairly healthy otherwise, come out ahead.

Personally I have, like and NEED health insurance, but if I was 28 y.o. and was just above the subsidy cliff, I'd really, really think about just paying the fine.

A 28 year old can get a catastrophic plan for $140/mo, even if no subsidy.


Sent from my iPhone using Early Retirement Forum
__________________
EastWest Gal is offline   Reply With Quote
Old 01-25-2015, 07:20 AM   #10
Full time employment: Posting here.
 
Join Date: Jan 2014
Posts: 662
Quote:
Originally Posted by clifp View Post
Actually from my understanding is you don't even need to pay the fine.

Just make sure your withholding is slightly less than the taxes you owe, and then pay the additional taxes, come April, but don't pay the fine.

Personally I wouldn't do that but it appears that IRS is not allowed to garnish wages or attach bank accounts to collect unpaid ACA fines.
Under current law, which could be changed in the future, you would need to do this every year until you die. The unpaid penalty/fine carries over from year to year with interest added.

http://americanactionforum.org/weekl...-aca-penalties
__________________
MBSC is offline   Reply With Quote
Old 01-25-2015, 01:46 PM   #11
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
mickeyd's Avatar
 
Join Date: Apr 2004
Location: South Texas~29N/98W
Posts: 5,881
Quote:

I hear that the number of uninsured has dropped at most hospital
emergency rooms in my state. I have yet to hear that hospital prices have
dropped since they no longer have to write off those bills.
Similarly, I have not noticed that the section on my recently paid Real Property tax annual bill under the heading of "Hospital District" any reduction in the amount that I am taxed. In fact, it has risen about 10%.

Thought that ACA was supposed to generate tax reductions in this area.

Guess I was wrong again.
__________________
Part-Owner of Texas

Outside of a dog, a book is man's best friend. Inside of a dog, it's too dark to read. Groucho Marx

In dire need of: faster horses, younger woman, older whiskey, more money.
mickeyd is offline   Reply With Quote
Old 01-25-2015, 04:15 PM   #12
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
clifp's Avatar
 
Join Date: Oct 2006
Posts: 7,450
Quote:
Originally Posted by SCGamecock View Post
Under current law, which could be changed in the future, you would need to do this every year until you die. The unpaid penalty/fine carries over from year to year with interest added.

Loophole Gives Uninsured Way Around ACA Penalties | Weekly Checkup | American Action Forum
I was curious about the unpaid interest and fine.. Good to know and I agree I doubt the current system will stay in place forever
__________________

__________________
clifp is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
ACA tax credit -negative tax liability in 2014 question shotgunner FIRE and Money 9 12-14-2013 05:55 PM
Defined Benefit Plan - Tax Penalty? markwhy Young Dreamers 4 02-08-2011 07:49 AM
Tax penalty question- public safety retirement RetLeo FIRE and Money 23 04-23-2009 11:16 AM
Annuity Tax/penalty Question bentley FIRE and Money 27 06-28-2008 06:06 AM

 

 
All times are GMT -6. The time now is 10:35 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.