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Tags: Healthcare Reform | Obamacare | taxes | HealthCare.gov

Tax Nightmare for Obamacare Enrollees as Deadline Passes

Tuesday, 30 September 2014 09:33 AM

The deadline was due to pass today for hundreds of thousands of Americans who are in danger of having to pay back their Obamacare tax credits because they have not verified their income.

When tax season comes around next year, they face the nightmare prospect of reimbursing the government for their overpaid federal healthcare subsidies, according to The Wall Street Journal.

The Obama administration had warned more than 300,000 individuals who had enrolled in Obamacare through the federal exchange HealthCare.Gov that their 2014 income did not match those on Internal Revenue Service records for 2012.

If their incomes cannot be confirmed, they will lose a certain amount of their subsidies and their health insurance will soar. And, even worse, they will have to pay back the subsidies they received this year.

“Most people don't know they even got advance tax credits," said Mark Ciaramitaro, vice president, health-care services at tax preparer H&R Block Inc. "They are going to be surprised and need to know what just happened, and a lot of people will be frustrated."

Obamacare enrollees who earned more this year than they had originally stated also face a bill from the government after receiving larger healthcare subsidies than they were entitled to, which could amount to thousands of dollars, the Journal said citing health policy experts.

 “There are a lot of people counting on their refund to pay for Christmas charges, and instead they'll be paying back their tax credit," said Timothy Jost, a professor of health law at Washington and Lee University.

Additionally, hundreds of thousands of people who signed up for Obamacare subsidies through state exchanges may be getting tax benefits that they are not eligible for because they do not have the proper paperwork proving immigration or citizenship status, the newspaper said.

In fact, 115,00 people were to lose coverage today (Oct. 1) if they had not sent in proof earlier this month showing they are legal immigrants or citizens, the Journal said.

Aaron Albright, a spokesman for the Centers for Medicare and Medicaid Services, said a recent Treasury inspector-general report showed that IRS records were almost perfect when it came to showing the actual income of people who had enrolled in the federal healthcare exchange.

"We are committed to keeping coverage affordable for the millions of Americans who depend on it, and to doing so in an efficient, transparent way that protects taxpayers," said Albright.

The reimbursements could be could be deducted from a tax refund, or consumers may have to write a check to the government, according to the paper. The repayments may be limited to $300-$2,500 for lower income earners, while higher earners may have to pay back the full amount, the IRS says.

© 2022 Newsmax. All rights reserved.


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The deadline was due to pass today for hundreds of thousands of Americans who are in danger of having to pay back their Obamacare tax credits because they have not verified their income.
Obamacare, taxes, HealthCare.gov
453
2014-33-30
Tuesday, 30 September 2014 09:33 AM
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