IRS Buy Health Insurance Or Lose Tax Refund

Individuals who don’t purchase health insurance may lose their tax refunds according to IRS Commissioner Doug Shulman. After acknowledging the recently passed health-care bill limits the agency’s options for enforcing the individual mandate, Shulman told reporters that the most likely way to penalize individuals that don’t comply is by reducing or confiscating their tax refunds.

Speaking at the National Press Club on Monday, Shulman downplayed the IRS’s role in enforcing the recent overhaul of the health insurance industry by claiming the agency would not aggressively target individuals who don’t purchase coverage. He noted that the health-care bill expressly forbids the agency from freezing bank accounts, seizing assets or pursuing criminal charges, but when pressed said the IRS would most likely use tax refund offsets to penalize those that don’t comply with the mandate. The IRS uses refund offsets to collect from individuals that owe the federal government a delinquent debt.

“These are not the kinds of things we send agents out about,” Shulman said. “These are things where you get a letter from us. Congress was very careful to make sure there was nothing too punitive in this bill.”

Many reports have claimed that enforcement of the individual mandate will be non-existent, but Shulman’s answers indicate differently. According to BusinessWeek, starting in 2015 Americans who don’t purchase insurance will be subject to a fine of $325 and that sum increases to $695 in 2016. However, the commissioner seemed confident that in most cases individuals would either receive subsidies to purchase insurance or simply do so on their own in order to comply with the law.

“The vast majority of American people have a healthy respect for the law and want to be compliant with their tax obligations,” Shulman said, mentioning letters, collection notices and offsets as among the various ways the IRS will reach out to people without coverage.

During his speech Shulman said threats against the IRS have not risen despite media reports to the contrary. He disagreed that it has become more dangerous to work for the IRS following the February incident in which a disgruntled pilot flew his plane into the agency’s Austin, Texas office, killing one employee.

“There’s been a lot of stuff in the press around increased threats, which is actually inaccurate,” Shulman said. “What there has been is increased chatter on the Internet that has an anti-government sentiment.”

He also said it is too early to know what additional resources or how many employees the IRS will need to enforce compliance with the mandate and clarified his reasons for using a professional tax preparer.

“I wouldn’t read into anything about me doing it now,” Shulman said. “I’m just a busy guy and have had good service for the past 15 years.”

16,000 New IRS Employees To Enforce Mandated Health Care Reform

House Republicans say the IRS will hire more than 16,000 new employees to enforce the so-called healthcare individual mandates requiring people to buy coverage.

Republicans also say the new healthcare bill will require 10-billion dollars to pay for new auditors, agents and employees at the IRS.

Herger says it’s another reason to oppose the legislation.

HERGER: “One-sixth of our entire economy to be taken over by Washington… by the federal government, with the IRS implementing this, enforcing it I should say is just one more outrage among many many outrages.”

Democrats say their overhaul plan will reduce health care costs over time – by making the size of the insurance pool larger. The House is expected to take a final vote on the plan Sunday with no Republican support.

IRS Visits Car Wash For Pursuit Of 4 Cents

It was every businessperson's nightmare.

Arriving at Harv's Metro Car Wash in midtown Wednesday afternoon were two dark-suited IRS agents demanding payment of delinquent taxes. "They were deadly serious, very aggressive, very condescending," says Harv's owner, Aaron Zeff.

The really odd part of this: The letter that was hand-delivered to Zeff's on-site manager showed the amount of money owed to the feds was ... 4 cents.

Inexplicably, penalties and taxes accruing on the debt – stemming from the 2006 tax year – were listed as $202.31, leaving Harv's with an obligation of $202.35.

Zeff, who also owns local parking lots and is the president of the Midtown Business Association, finds the situation a bit comical.

"It's hilarious," he says, "that two people hopped in a car and came down here for just 4 cents. I think (the IRS) may have a problem with priorities."

Now he's trying to figure out how penalties and interest could climb so high on such a small debt. He says he's never been told he owes any taxes or that he's ever incurred any late-payment penalties in the four years he's owned Harv's.

In fact, he provided us with an Oct. 22, 2009, letter from the IRS that states Harv's "has filed all required returns and addressed any balances due."

IRS spokesman Jesse Weller isn't commenting "due to privacy and disclosure laws."

Zeff says he's as offended as much as anything else by what he considers rude behavior by the IRS guys. While at Harv's, he sniffs, "they didn't even get a car wash."
By Bob Shallit of SacBee