Monday, February 04, 2013

IRS: "Obamacare Will Cost Average Family $20,000 Per Year"

Back on March 23, 2010, President Obama hugged HHS Sec. Kathleen Sebelius and then Speaker of the House Nancy Pelosi, thanking them for helping ram his so-called "Affordable Healthcare Act" through Congress before members had even read it.

The President promised that now everyone would have "affordable healthcare."

Sometimes things are not as they seem.

Three years later we find it is not affordable.

But everyone will have it. Except those given special exceptions---like Congressional members, etc.

And if you don't "have it", the IRS will impose a penalty.

In an attempt to create an assumption of what people can expect as Obamacare comes in effect, the IRS reported last week that it will cost a typical family $20,000 per year.

Affordable?

Here are some details.


Found in examples used in the IRS report to help families understand how to calculate the penalty if they do not buy the mandated health plan is the $20,000 number.

The IRS used examples of a family of 4 and a family of 5 people and the cheapest plan, the "bronze" plan of Obamacare, to make the calculations.

This "affordable healthcare plan" will be in full effect in 2016 as its father leaves office to retire in Hawaii.

CNS news has taken a careful look at the IRS report. This is what they found:

The annual national average bronze plan premium for a family of 5 (2 adults, 3 children) is $20,000,” the regulation says.

Bronze will be the lowest tier health-insurance plan available under Obamacare--after Silver, Gold, and Platinum. Under the law, the penalty for not buying health insurance is supposed to be capped at either the annual average Bronze premium, 2.5 percent of taxable income, or $2,085.00 per family in 2016.

In the new final rules published Wednesday, IRS set in law the rules for implementing the penalty Americans must pay if they fail to obey Obamacare's mandate to buy insurance.

To help illustrate these rules, the IRS presented examples of different situations families might find themselves in.

In the examples, the IRS assumes that families of five who are uninsured would need to pay an average of $20,000 per year to purchase a Bronze plan in 2016.

Using the conditions laid out in the regulations, the IRS calculates that a family earning $120,000 per year that did not buy insurance would need to pay a "penalty" (a word the IRS still uses despite the Supreme Court ruling that it is in fact a "tax") of $2,400 in 2016.

For those wondering how clear the IRS's clarifications of this new "penalty" rule are, here is one of the actual examples the IRS gives:

Example 3. Family without minimum essential coverage.

(i) In 2016, Taxpayers H and J are married and file a joint return. H and J have three children: K, age 21, L, age 15, and M, age 10. No member of the family has minimum essential coverage for any month in 2016. H and J’s household income is $120,000. H and J’s applicable filing threshold is $24,000. The annual national average bronze plan premium for a family of 5 (2 adults, 3 children) is $20,000.

(ii) For each month in 2016, under paragraphs (b)(2)(ii) and (b)(2)(iii) of this section, the applicable dollar amount is $2,780 (($695 x 3 adults) + (($695/2) x 2 children)). Under paragraph (b)(2)(i) of this section, the flat dollar amount is $2,085 (the lesser of $2,780 and $2,085 ($695 x 3)). Under paragraph (b)(3) of this section, the excess income amount is $2,400 (($120,000 - $24,000) x 0.025). Therefore, under paragraph (b)(1) of this section, the monthly penalty amount is $200 (the greater of $173.75 ($2,085/12) or $200 ($2,400/12)).

(iii) The sum of the monthly penalty amounts is $2,400 ($200 x 12). The sum of the monthly national average bronze plan premiums is $20,000 ($20,000/12 x 12). Therefore, under paragraph (a) of this section, the shared responsibility payment imposed on H and J for 2016 is $2,400 (the lesser of $2,400 or $20,000).

This is a glaring example of how America is being led off the cliff.

God help us.

Be Informed. Be Vigilant. Be Discerning. Be Active. Be Involved. Be Prayerful--Very Prayerful.

15 comments:

  1. So families are to be faced with either paying $20,000 to have insurance or $2,400 to not have insurance? This in itself will force more families to not have any type of insurance unless they have a hefy employer contribution. Even then, where is the money coming from when the employer has to fork it out on employee benefits?!?
    This is truly a "Were here from the government..." moment.

    ReplyDelete
    Replies
    1. check my tables of progressive tax rates to see where we are really headed on ObamaCare, then check the one for balancuing the fed budget and pasyiong ofgf the nationasl debt as a 30 yeasr mortgage at 2%.

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    2. we lemming off thed cliff long ago; we are in free fall til ww hit the ground of reality.
      For a more realistic table of costs vs promised payments, check my posts on the progressive tax scedules required to pay for ObamaCare, balancing the fed budget,m and payiung off the national debt as a 30 year mortgage at 2%. Welcome to the silent free fall.

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  2. I am not the best in math, they really complicated this when a common citizen can barely understand it. If I choose to use the Obamacare health plan, how much is that going to cost me out of pocket? It better not be half my 40,000 salary I earn. I cannot even afford my employer's rates; how is the government going to fund this? Pass it on to the taxpayers? By the first appearance, we cannot afford this!

    ReplyDelete
    Replies
    1. Forget the scare numbers Gary throws out, his dire predictions are always, and I do mean always, just meaningless hyperbole meant to scare you. Obamacare is not going to cost you $20k a year.

      It looks like a family of 4 headed by a 40 year old making your $40k salary will be around $115 a month or about $1,300 a year. Do a search for health exchanges, this info is out there. I'm self employed and I can't wait for them to kick in this October.

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    2. you math may be short but mine isn't so check my rundown of needed payments on a progressive tax rate for ObamaCare and for balancing the fed budget - after a $400 billion reduction - and to payoof the national dfebt as a 30 year mortgage at 2% interest. Only incompetents beieve you can spend at leadst 40% more than income and survive.

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  3. Since when did the "average" family have $120,000 in adjusted gross income? Also, who has an AGI of $120k, but doesn't get employer provided health insurance?

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  4. It's fun to see libs attacking Obama's IRS. Yeah, I agree, the IRS is all messed up. What do they know. Woops, aren't they the ones who will be enforcing this?

    ReplyDelete
    Replies
    1. Yes, the IRS was one of Obama's worst ideas. I can't believe he created it!

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  5. "Except those given special exceptions"

    It appears anyone will be except if they can't find coverage for 8% of your income. So for the actual median household of $50k, that's about $4,000.

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  6. So the bad news is that the cost of health care is breaking the country. The worse news is that the new cost of health care will continue to break the country. And the even more worse news is that if we don't pay the cost of health care, the fines for not paying will still break the country. However, Congress appears to be trying hard to save us from all of these potential disasters by pushing the country over the fiscal cliff through out of control deficit spending that may totally destroy the economy before any of this can take effect.

    Joking aside, the only serious matters are the fact that ObamaCare violates our healthcare freedom of choice; that it violates the U.S. Constitution; and that it therefore is mere "pretended legislation" as our nation's founders described such acts in their Declaration of Independence. The good news is that this unconstitutional act is so easy to stop and that we have so many means left to us for stopping it - it can be defunded by the Republican controlled U.S. House; state governors can interpose on behalf of their citizens; state legislatures can nullify it; and county sheriffs can perform their duty to protect the rights of their citizens. You can read a full explanation of how ObamaCare can be stopped in the most recent article at my blog - http://bobpeck.wordpress.com

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  7. "the cost of health care is breaking the country"

    It doesn't have to, other countries spend half as much or less, cover everyone, and have better outcomes.

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  8. This has been published to over 100 media outlets in nearly two years without answeriung. See Utube. Worse, if we reduce fed budget by 400 billion asnd balance the budget, and payoff national debt as a 30 mortgage at 2% interest, our total average wage earner 'tax' will at least increase by 50%. Here's part:
    Income $10,000
    Tax about $1200, last year the taxpayer paid about $1000
    Income $30,000
    Tax about $6000, last year they paid about $3500
    Income $60,000
    Tax about $18,000; last year they paid about $12,000
    Income $100,000
    Tax about $33,000; last year they paid about $20,000

    And if your income is $200,000, your tax will be about $90,000. Needless to say, that’s why Congress must increase the debt limit; they’d be held accountable to their subjects for their fiscal incompetence if they didn’t. (At least, until they can get out of office with their benefits.) The sad part is we don’t even have a clue what’s happening; I guess free fall is silent until you hit the ground.


    For a complete rundown of progressive rates applications request from jweme@earthlink.net

    ReplyDelete
  9. This has been published to over 100 media outlets in nearly two years without answeriung. See Utube. Worse, if we reduce fed budget by 400 billion asnd balance the budget, and payoff national debt as a 30 mortgage at 2% interest, our total average wage earner 'tax' will at least increase by 50%. Here's part:
    Income $10,000
    Tax about $1200, last year the taxpayer paid about $1000
    Income $30,000
    Tax about $6000, last year they paid about $3500
    Income $60,000
    Tax about $18,000; last year they paid about $12,000
    Income $100,000
    Tax about $33,000; last year they paid about $20,000

    And if your income is $200,000, your tax will be about $90,000. Needless to say, that’s why Congress must increase the debt limit; they’d be held accountable to their subjects for their fiscal incompetence if they didn’t. (At least, until they can get out of office with their benefits.) The sad part is we don’t even have a clue what’s happening; I guess free fall is silent until you hit the ground.

    ReplyDelete
  10. Healthcare costs are 17% of GDP, now about $16 trillion, up from last reported mostly by price increases. Thats $2.72 trillion; that must be spread over 100 million wage earners (not taxpayers, many listed tho only one had wages) and 50 million seniors. For the math deficient , letting seniors contribute $500 billion leaves some $2.2 trillion to 'contribute'. Thats $22,000 a year average , in a country where the average wage is in low thirties.
    Here's the cost as is:
    COST OF AFFORDABLE CARE ACT, AS WRITTEN.

    avg tax paid by
    wagec earner in
    Wage brackets bracket PER MO.

    Under $5,000 $22
    $5,000 under $10,000 39
    $10,000 under $15,000 56
    $15,000 under $20,000 78
    $20,000 under $25,000 90
    $25,000 under $30,000 157
    $30,000 under $35,000 232
    $35,000 under $40,000 296
    $40,000 under $45,000 371
    $45,000 under $50,000 423
    $50,000 under $55,000 614
    $55,000 under $60,000 854
    $60,000 under $75,000 1,073
    $75,000 under $100,000 1,463
    $100,000 under $200,000 2,264
    $200,000 under $500,000 4,278
    $500,000 under $1,000,000 8,641
    $1,000,000 under $1,500,000 13,297
    $1,500,000 under $2,000,000 18,016
    $2,000,000 under $5,000,000 28,798
    $5,000,000 under $10,000,000 61,068
    $10,000,000 or more 173,959
    STICK THAT IN YOUR BUDGET. No one ever said politicians have math skills; after akll its only a promise not a fact.

    So Congresss and Obama will pare costs by reducing paymednts to provider doctors and hospitals, pare the too sick and the too 'rich', and add the balance of payments to the national debt. Go ahead, make our day.

    ReplyDelete

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