Tuesday, March 26, 2013

Obamacare's insurance subsidies | Radio Vice Online

Last week the federal government issued information concerning the sign-up process for Obamacare that will begin October 1 of this year.? Here are the details.

[T]he health bureaucrats have quietly posted a 21-page draft of the?application?for Obamacare. It?s accompanied by a 61-page explanatory document.

Forgetting for the moment the complexity of the application?process, I thought it might be of?interest to deal with only one aspect?the income portion of the application process that will determine whether one receives a subsidy to cover all, or a portion of the cost of the premiums, or is ineligible for any subsidy.

According to the government, when your application is submitted, the income you report will be instantaneously verified by the IRS.? There is only one small problem.? As of October, 2013, the only income data the IRS has is what was reported on your 2012 income tax return.

So, let?s say, for example, you earned?$100,000 in 2012, and this amount is reported on your 2012 return.??In this case, you?would not qualify for a subsidy.? But, let?s say,?you lost your job in 2013, and only?expect to earn?$35,000 in 2013.? In that case, you would qualify for a subsidy.? On the application you submit in October of this year, you dutifully report your 2013 income as $35,000, but, the IRS will bounce it back because its records show you make $100,000.

Of course, the converse is also true.

Then, what do you do about the pesky situation where one qualifies for a subsidy, but owes back taxes?? Is the subsidy paid, or will it be used to off-set what you owe?

Heck, why am I wasting my time on this?? The federal government is in charge.? What could possibly go wrong?

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Source: http://radioviceonline.com/obamacares-insurance-subsidies/

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