Did Justice Roberts Kill ObamaCare By Calling The Individual Mandate A Tax?

In 2012, conservatives thought for sure that the Individual Mandate in ObamaCare would be struck down because -- for the first time ever in this country -- it would levy a penalty on Americans for not buying something.  Thus, if the individual mandate was found unconstitutional, the whole law would be nullified because it did not include a single severability clause. However the conservative Supreme Court, led by Chief Justice Roberts, upheld ObamaCare because, in their opinion, the mandate for not buying health insurance was a tax and the government has a legitimate and constitutional power to levy taxes.

Many on the right were fuming that a conservative court would do such a thing.  But, it just might be that The Supreme court had actually sealed the coffin on ObamaCare by calling the mandate a tax.  By doing so, either knowingly or unknowingly, it established that it may be unconstitutional because the law originated in the Senate instead of the House of Representatives.  This, then, was a violation under something called the Origination Clause. A clause that clearly says that any law involving an increase in revenues (taxes) must originate in the House of Representatives.

Seizing on that very nuance of constitutional law, the Pacific Legal Foundation -- on behalf of a gentleman by the name of Sissel -- has filed suit in federal courts to invalidate the Individual Mandate.  Sissel, himself, has standing in the courts because he does not have health insurance; does not want health insurance; and, is being forced to buy insurance because of the tax (the Individual Mandate).

Currently, the suit is on temporary hold in U.S. District Court in the District of Columbia; pending the outcomes of other lawsuits involving ObamaCare.  However, if it is litigated successfully in that court, the next stop would be the Supreme Court.  This time, in both a twist of irony and fate,  Roberts' court may find ObamaCare unconstitutional on the very basis that it had found it to be constitutional in 2012. 

References:

Supreme Court upholds individual mandate, ObamaCare survives: http://www.foxnews.com/politics/2012/06/28/supreme-court-upholds-individual-mandate-obamacare-survives/

Severability: http://en.wikipedia.org/wiki/Severability

Tax-raising Affordable Care Act started in wrong house of Congress: Sissel v. United States Department of Health & Human Services: http://www.pacificlegal.org/cases/Sissel-3-1374

Origination Clause: http://en.wikipedia.org/wiki/Origination_Clause

The ObamaCare Indiviual Mandate Tax Penalty Explained

One of the most incorrectly stated details of ObamaCare is the tax penalty for not buying health insurance.  Many think that if you don't buy insurance, there is simply a $95 penalty.  That's true for some but not for all; and, only this year.  Then, there are those that who say the penalty is $95 or one percent of income; whichever is higher.  Now, that may be closer to the truth but, understand the ObamaCare penalty is an IRS tax collection program and no IRS system of taxation is ever that simple in its execution.

First of all, Health and Human Services (HHS) states that if you are an individual making less than $10,100 or a married couple making less than $20,200, you are not eligible for a penalty.  The only reason these amounts are even in the law is because these are the thresholds for not having to file a 2014 tax return.  Thus, if you don't have to file a tax return, the IRS has no mechanism to collect the penalty.

But here's where the insanity of ObamaCare really shows up.

If you are an individual making less than $11,490, you are eligible for Medicaid (free healthcare) in all 50 states.  That's because HHS says you are in poverty.  So, if your income is between $10,100 and $11,490, the penalty literally becomes a stupidity tax for you not signing up for Medicaid.  If you live in a state that agreed to the expansion of Medicaid under the new health care law, the stupidity tax is raised for those individuals making less than $15,282.  Now, here's some further insanity.  If you and your wife have a combined income above $15,510, HHS says that you are above the poverty threshold and you must buy insurance through the exchanges.  The IRS says, not so fast.  We don't collect until you make $20,200.  So, in essence there is a nearly $4,500 "hole" where no penalty can ever be applied.

Now to the true application of the penalty.  If you are an individual making less than $19,150 or a family with a combined income of  under $35,500 the tax penalty is fixed. For 2014, the fixed penalty will be $95 per adult and one-half of that or $47.50 for each child; with a family cap of 300% of the basic adult penalty or $285.  In 2015, the penalty is raised to $325 per adult with a cap of  $975.  By 2016, the respective numbers are $695 and $2085.  In both 2015 and 2016, the child penalty is one-half the adult tax.

Also, in 2014, if you make more than the fixed rate thresholds, the penalty is calculated at 1% of gross income after subtracting the IRS filing threshold of $10,100 for singles or $20,200 for marrieds.  The cap for this tax group is based on the national average of the cost of an ObamaCare bronze plan.  Also, for each income level, there are deductions that lower the penalty for those who are either married or married with children.  For example, an individual making $50,000 would pay a tax (penalty) of $402.  If married with no children, the penalty drops to $305.  Add a child and the penalty is only $267.  That's why if you want to know what your particular penalty is, use the calculator below.

In 2015, the 1% penalty will be increased to 2%.  By 2016, it will hit 2.5% and, then, increased each year thereafter by the rate of inflation.

Now, any decent Democrat-minded law wouldn't be complete without exemptions from the tax penalty and here they are:

• You’re uninsured for less than 3 months of the year
• The lowest-priced coverage available to you would cost more than 8% of your household income
• You don’t have to file a tax return because your income is too low (Learn about the filing limit.)
• You’re a member of a federally recognized tribe or eligible for services through an Indian Health Services provider
• You’re a member of a recognized health care sharing ministry
• You’re a member of a recognized religious sect with religious objections to insurance, including Social Security and Medicare
• You’re incarcerated, and not awaiting the disposition of charges against you
• You’re not lawfully present in the U.S.

But, on top of that, there are a bunch of so-called hardship exemptions available to you that may make all the tax penalties null and void.  Especially the newest one that says "Your individual insurance plan was cancelled and you believe other Marketplace plans are unaffordable."  Here's that list:

1. You were homeless.
2. You were evicted in the past 6 months or were facing eviction or foreclosure.
3. You received a shut-off notice from a utility company.
4. You recently experienced domestic violence.
5. You recently experienced the death of a close family member.
6. You experienced a fire, flood, or other natural or human-caused disaster that caused substantial damage to your property.
7. You filed for bankruptcy in the last 6 months.
8. You had medical expenses you couldn’t pay in the last 24 months.
9. You experienced unexpected increases in necessary expenses due to caring for an ill, disabled, or aging family member.
10. You expect to claim a child as a tax dependent who’s been denied coverage in Medicaid and CHIP, and another person is required by court order to give medical support to the child. In this case, you do not have to pay the penalty for the child.
11. As a result of an eligibility appeals decision, you’re eligible for enrollment in a qualified health plan (QHP) through the Marketplace, lower costs on your monthly premiums, or cost-sharing reductions for a time period when you weren’t enrolled in a QHP through the Marketplace.
12. You were determined ineligible for Medicaid because your state didn’t expand eligibility for Medicaid under the Affordable Care Act.
13. Your individual insurance plan was cancelled and you believe other Marketplace plans are unaffordable.
14. You experienced another hardship in obtaining health insurance.

The last one sounds like the ultimate hardship was having to sign up for ObamaCare on their failing websites. Anyway, that's it.  Not nearly as simple as the $95 penalty that keeps getting bandied about. 


References:

ObamaCare Penalty Calculator (note: Accurate but does not apply the IRS limits): http://www.healthinsurance.org/learn/obamacare-penalty-calculator/

Federal Poverty Levels: http://obamacarefacts.com/federal-poverty-level.php

What if someone doesn't have health care coverage in 2014?: https://www.healthcare.gov/what-if-someone-doesnt-have-health-coverage-in-2014/

How do I qualify for an exemption from the fee for not having health coverage?: https://www.healthcare.gov/exemptions/

Rush Limbaugh Is Wrong On Having To Pay The ObamaCare Tax In 2014

Recently, Matt Drudge, of the Drudge Report, tweeted that he just paid the tax for not having health insurance in 2014 and he called it his "freedom tax".  Immediately, he was labelled as going from being a complete liar to being just plain stupid for paying a tax that Obama put off until taxes are paid in 2015. Today, Limbaugh went on a tirade in defending Drudge saying that he only did what the law "requires" him to do.  

Now, to be exact, Drudge is one of those people or businesses that are required to file their taxes every quarter along with a supporting form: the 1040ES. With regard to the health care penalty, the IRS instructions are simply advisory:

"Health care coverage. When you file your 2014 tax return in 2015, you will need to either (1) indicate on your return that you and your family had health care coverage throughout 2014, (2) claim an exemption from the health care coverage requirement for some or all of 2014, or (3) make a payment if you do not have coverage or an exemption(s) for all 12 months of 2014."

Contrary to Limbaugh's rant, it was optional for Drudge to pay the tax early.  The IRS simply says that "When you file...in 2015" the payment is due for not having health insurance for 12 full months in 2014.  It implies no mandatory payment on a quarterly basis or even any interest penalty for failing to do so. It then goes on to say that you "can" pay the tax penalty early by indicating so on line 12, Other Taxes, of the 1040ES form.  Even so, only a quarter of the estimated total penalty would be due at this time.

Often I agree with Rush, but this time he's wrong and, in this case it hurts his credibility.

References:

‘Liberty Tax’: White House, Media Attack After Drudge Pays Obamacare Opt-Out Penalty: http://www.breitbart.com/Big-Government/2014/03/21/White-House-Leads-Liberal-Media-In-Matt-Drudge-Attack

2014 1040ES Filing Instructions: http://www.irs.gov/pub/irs-pdf/f1040es.pdf

The Individual Mandate Tax: Obama's "Mitt Did It Too" Argument

Often, when little kids are caught doing something wrong, they will use the "but, Bobby did it too" excuse; as if Bobby's badness should somehow excuse their own wrongdoing.  Children quickly learn that this tactic won't let them escape punishment.  So, its interesting to see an adult, especially one that's the President of the United States, pull that same childish stunt.  It has to do with the Individual Mandate being a tax, and especially, a tax on the middle class.

Obama and his people seem to think that he should be excused for having created a middle class tax as part of ObamaCare because Mitt did the same thing in Massachusetts with that health care law. But, Mitt Romney didn't stand up before the American people for the last 4 years and promise no new taxes on the middle class.   Obama did...and, the Supreme Court has confirmed that the Individual Mandate is, in fact, a tax on the middle class.  So, if Obama wants to continue to use the  "Mitt did it too" excuse, he should go "wash his mouth out with soap"; like any other little bad kindergartner.

Obama Surrogates Downplay The Individual Mandate Tax And Even Refuse To Call It A Tax.

Both as a candidate and as president,  Barack Obama has promised no new taxes or any tax increases on anyone making less than $250,000:



Yet, when Obama's Solicitor General went before the Supreme Court to argue the constitutionality of ObamaCare, he argued that the Individual Mandate and its associated penalty was a tax; and, that Congress had the constitutional authority to levy such a tax. If he had argued that the penalty was a penalty,  that would have squarely placed the Individual Mandate under the purview of the Commerce clause; making it easier to be found unconstitutional. Ultimately, the John Robert's Supreme Court agreed with Obama's "tax" argument.

But, now, in a "be careful what you wished for" sidestep of reality, the Obama Administration is doing everything it can to avoid calling the Individual Mandate Tax a "tax".  To do so, would reveal that Obama had gone back on his  pledge not to tax anyone making less than $250,000.  Just listen to Obama's Chief of Staff squirm over the tax issue:



Then, there are these nonsensical  remarks uttered by Nancy Pelosi:



But, more than that, the Obama surrogates are also trying to downplay that "tax" by trying to say it will "only" affects 1% of the population who irresponsibly don't buy health insurance.   However, that 1% of our population is over three million people. But, that, too, is a deception because the Congressional Budget Office expects that the "tax" will affect more than 4 million people.   I personality think that number could be upwards of 20 million people or even more.   That's because, under ObamaCare, no insurance company can deny you coverage for any preexisting condition.  So, why pay a minimum of $3000 a year for health insurance when you can simply pay the Individual Mandate Tax of $700 a year?  That's an annual savings of at least $2300 that can easily pay for a lot of  "ordinary" health care costs over a per of a year's time.  Then, when you really do get sick -- like being diagnosed with cancer -- you can simply sign up for insurance.  And, the insurance company can not deny you that coverage because you now have a disease.

It's this combination of a small Individual Mandate tax and the exclusion of any preexisting conditions that will ultimately play a part in destroying the private health insurance system in this country; forcing all Americans to become part of a government-run, single-payer health care system.  And, that's been the goal of the Democrats all along.

Lastly, no Republican should let Obama or any other Democrat snooker the American people by avoiding calling the Individual Mandate Tax a tax.  It was argued as such; and, it was found constitutional as such.

Justice Roberts Pontius Pilate Moment on ObamaCare

In all gospel writings on the subject, Pontius Pilate refused to condemn Jesus Christ for claiming to be king of the Jews because such a claim was not a violation of Roman law.  To Pilate, it was purely a Jewish matter. So, he sent the issue back to the Jewish people for any punishment and, he symbolized this by literally washing his hands in front of an angry Jewish crowd that had amassed outside of his office window. 

In many ways, conservative Chief Justice John Roberts did the same thing as Pontius Pilate by his siding with the 4 liberals on the Supreme Court in upholding both ObamaCare and its individual mandate.  Thus, he figuratively washed his hands and the court's hands by, in essence,  sending it back to the people and Congress to resolve.   At the same time, he gave the court the  appearance of being apolitical; even though the rest of the court voted along politically ideological lines.

So, now, ObamaCare has become a big issue, besides the economy, for the voters in November.  If  the people want to keep it intact, they can vote for Obama and other Democrats.  If not, the voters will run them all out of town.

In a strange way, the Roberts decision may have actually given an advantage to the Republicans.  First of all, the law is already known to be broadly unpopular; even though many Americans like certain parts of it.  By upholding the law, on a constitutional basis, and sending it back to the people, Roberts may have actually energized voter turnout; with a higher number of Republicans and Independents coming out on election day to vote for those who would overturn the law.  At the same time, Roberts may have suppressed some amount of Democrat votes because it took away the anticipated campaign strategy that Obama would energize his voting base by running against a conservative Supreme Court.   Additionally, the court's decision exposes the penalties of ObamaCare as being a tax.  Something that the President specifically lied about when he was selling its passage.  That fact, alone, may turn off a certain number of voters.

All and all, today's Supreme Court decision may have been a good thing for the Republicans and the country.