PSA: Before you pay a penalty for not having Health insurance during 2016

[Lanny]

In different threads on WTM, I've read posts from people who wondered if they would need to pay a Penalty to the I.R.S., when they file their Income Tax Return for 2016.  I read this in an article and am not a Tax Accountant or Tax Attorney, and I do not know whether or not this will apply to 2016 tax returns: 

 

"It also tells agencies to waive, defer or delay imposing any ObamaCare provisions that impose fiscal penalties on states, health care providers, families or individuals."

 

That is about an Executive Order that was signed yesterday. It was in an article on this URL: http://www.foxnews.com/politics/2017/01/20/trump-orders-regulatory-freeze-directs-agencies-to-ease-burden-obamacare.html

 

SUGGESTION: Check with your C.P.A., or an I.R.S. "Enrolled Agent", before you pay a Penalty.

[TranquilMind]

With the Executive Order he signed yesterday, I would think that penalties for not having insurance would not be enforced.  But yes, I'd sure check with someone to be sure! 

[Lanny]

With the Executive Order he signed yesterday, I would think that penalties for not having insurance would not be enforced.  But yes, I'd sure check with someone to be sure! 

 

If the law has changed, the I.R.S. will need to redo the tax form(s) that apply to that.    Early filers who might be subject to the penalty should delay filing their returns to the I.R.S.  

[TranquilMind]

If the law has changed, the I.R.S. will need to redo the tax form(s) that apply to that.    Early filers who might be subject to the penalty should delay filing their returns to the I.R.S.  

 

Ugh.  What a mess for them. Since we often end up paying, we will wait!

 

[Sneezyone]

The president cannot change a law by executive order. It remains to be seen whether Congress will assert its authority on the matter tho. There is some reluctance on the part of Congress to lose/eliminate the ACA funding mechanisms before a replacement plan is in place and the IRS cannot turn on a dime.

Edited January 21, 2017 by Sneezyone

[Pawz4me]

The EO was more for show than substance. Or at least any immediate substance.

[EmseB]

It's pretty much the same thing Obama did when he told the IRS not to enforce the individual mandate back when the website was going tango uniform and people were having a hard time signing up.  He delayed enforcement on it until 2015 (I think it was 20 separate delays, IIRC correctly, but I could be remembering it wrong), and then Congress introduced a bill later to delay it even further.

 

The executive branch shouldn't selectively enforce laws, but they do, and it works for good political points, so I doubt it will be stopped as a practice anytime soon.

[Lanny]

This article has an update and amplification of the first article:  http://www.foxnews.com/politics/2017/01/21/trump-s-obamacare-order-could-signal-insurance-mandate-rollback.html

There were tons of Executive Orders during the past 8 years.  I seem to remember that the only reason the Supreme Court said that the ACA/ObamaCare was valid was BECAUSE IT IS A TAX.   That's the Penalty, for not having health insurance.  Many many years since I took a course in U.S. Government, but I think/believe that only the Congress has the authority to set taxes, according to the U.S. Constitution.  So, probably, for this to be sustained in the courts, the Congress will need to amend the law, to eliminate the TAX (the Penalty for not having health care insurance). Hugely complicated and the Individual Mandate, according to this article, is one of the most unpopular things about ACA/ObamaCare.  

Edited January 21, 2017 by Lanny