William McGurn/WallStreetJournal
Is there an IRS agent in your future?
Shortly before Barack Obama signed the health-care bill, Republicans on the House Ways and Means Committee created a stir with a report suggesting our new law will lead the Internal Revenue Service to hire as many as 16,500 new agents. The Republicans came up with the figure by extrapolating from the IRS budget, the amount spent on employees, and the $10 billion in new funding that the Congressional Budget Office says the IRS will need to meet its new responsibilities under this legislation.
It’s made for some heated debate. In an entertaining segment on the Fox News Channel last week, host Bill O’Reilly tried to get Rep. Anthony Weiner (D., N.Y.) to admit that the IRS would have to enforce the penalty tax for people who refused both to get the mandated coverage and to pay the penalty. Mr. Weiner accused Mr. O’Reilly of “making stuff up.” The next day, IRS Commissioner Douglas Shulman seemed to settle the question in Mr. Weiner’s favor when he testified to Congress that IRS agents are not going to be auditing taxpayers to verify that they’ve obtained acceptable health insurance.
Or did he?
The individual mandate remains one of the murkiest bits of this legislation. During the 2008 primaries, Mr. Obama criticized rival Hillary Clinton for favoring such a mandate. He later changed his mind, for one big reason: There’s no way to afford expensive provisions such as forcing insurance companies to cover people with, say, pre-existing conditions unless millions of healthy people who won’t need insurance are forced to pay into the system. With the mandate, the government gets more healthy people into the risk pool—and with the penalty it gets their money whether they buy coverage or not.
In testimony before a House Ways and Means subcommittee last Thursday, the IRS commissioner deflected questions about the agency’s precise role vis-à-vis health care. Mr. Shulman reassured citizens that this bill does not “fundamentally alter” their relationship with the IRS, and said the IRS would not be snooping into their health records. About the penalties associated with the mandate, he was less clear.
Partly that’s because the law is unclear. The original House bill opened the door for criminal sanctions against Americans who didn’t buy health insurance and pay the penalty. The Senate bill did the same until Sen. John Ensign (R., Nev.) successfully pushed to amend the bill. Even so, the final language begs the question that Mr. Shulman and Mr. Weiner avoided: Who’s going to enforce the mandate, and how?
It’s more than a theoretical proposition. Approximately one in six drivers goes without auto insurance, according to the Insurance Research Council, even though most states require it. As for health coverage, the U.S. Census says that Massachusetts’ has the nation’s lowest rate of uninsured at 5.4%, thanks in part to its own individual mandate. Even so, costs have exploded and fines for not carrying coverage are increasing.
Almost by definition, those hit by the mandate will be either young people starting out, or those working for smaller businesses that do not provide employees with health coverage. Back in November, a report by the Congressional Budget Office and Joint Committee on Taxation estimated that nearly half (46%) of the mandate penalties will be paid by Americans under 300% of the poverty line.
In today’s dollars, that works out to $32,500 for an individual. For a family of four, it’s $66,150. Generally speaking, these are not the folks who have to worry about paying taxes on, say, a villa in the Dominican Republic or income from the International Monetary Fund.
So we are left with one of two possibilities. The first is that the penalty for not having “minimal essential coverage” is fully enforced, in which case Americans of relatively modest means will get a lesson in how the government deals with people who don’t pay up.
Or the penalty for violating the individual mandate will become like the fines for not filling out your Census form. In other words, unenforced. In that case, the costs of this legislation will be even higher and more hidden than we have been led to believe.
In his appearance before Congress, Mr. Shulman stated he was still working on “the proper resources” the IRS would need to handle the tax provisions of the health-care act. Maybe that won’t mean 16,500 new agents. If the Republicans do manage to take back Congress come November, however, it should mean hearings in which Mr. Shulman provides the American people with specific answers about how much bigger the IRS is going to get because of this bill—and how exactly the IRS will deal with Americans who don’t pay the penalty tax.
Then again, that’s something Congress might have done before passing the bill.
The UK Guardian picked up the Southern Poverty Law Center story and ran with it under 
the misleading headline “Inside the world of Obama’s secret-service bodyguards”. Their story has almost nothing to do with how the secret service is protecting Obama and almost every thing to do with right wing extremism as defined in the SPLC report. But as typical with the media, the facts can’t get in the way of the story they want to tell.
Apparently everyone believes that if anything happens to this president it will be at the hands of some right wingnut, as they define whatever that is. But this morning at Red State, Erick Erickson does a fine job defining the real origin of violence in the name of politics.
It’s been conveniently ignored that Joe Stack, the Texas pilot who flew into the IRS offices, was quoting Marx in his final missive. That fact doesn’t fit the narrative that the media has already written, so they just leave that out.
Scapegoating the right – an Alinsky tactic – will continue to be the statist media’s plan of action.
~~~ooOoo~~~
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Reps Boehner, Camp and Cantor demand IRS take action now to cut ties and promotion of ACRON as tax preparers for the poor.
Did these 2 twenty-somethings ever imagine the tsunami that they would create with their journalistic endeavors? LOL
Hannah is a new columnist at Townhall.com!
Senator Max Baucus (D-MT) released his general plan for the Senate version of ObamaCare yesterday, and it portends some hefty costs for American families. Baucus stripped out the public option but left in place individual mandates to buy insurance — and backed them with big fines, administered by the IRS. Each family could pay up to $3800 per year for failing to get government-approved coverage:
A bipartisan group of senators huddled in the afternoon to decide whether to move forward on an overhaul plan that Senate Finance Committee Chairman Max Baucus (D., Mont.) began circulating over the weekend. The plan includes some of the stiffest penalties Congress has proposed for Americans who don’t carry health insurance coverage.
Sen. Baucus emerged from a meeting with the six-member bipartisan group saying he had given his colleagues until 10 a.m. Wednesday to provide feedback on his draft. The group will meet again Wednesday afternoon in an attempt to come up with an agreement before Mr. Obama’s address.
Under the plan, people who earn between 100% and 300% of the poverty level (or between about $22,000 a year and $66,000 a year for a family of four) would face fees ranging from $750 to $1,500 a year.
For taxpayers with incomes above 300% of poverty, the penalty starts at $950 a year and reaches as high as $3,800 for families. Nearly 12 million people fit in this category, according to the National Institute for Health Care Management.
Individual mandates are bad enough, at least constitutionally speaking. States have insurance mandates for drivers, but those are predicated on accessing public roads, not private enterprise. The courts should make minced meat out of an argument that Congress has the power to compel citizens to buy insurance for any reason, let alone health insurance.
But the problem here goes beyond the mandate, and even beyond the fine. Who will manage this mandate? Who determines the validity or non-validity of insurance coverage? That bastion of medical knowledge, the Internal Revenue Service. Taxpayers will have to provide proof of insurance from the previous tax year to avoid the fines. If the IRS doesn’t consider the coverage adequate, families could be out the cost of the coverage and the fine. They can appeal any negative verdicts, of course … to the IRS.
The IRS hasn’t the expertise, nor the flexibility, to manage the nation’s health-insurance coverages. This is a tremendously bad idea. As I wrote earlier, who in this country believes that the IRS doesn’t intrude enough into their lives?
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