Despite the hullabaloo about the Affordable Care Act’s mandate that nearly everyone puchase heath insurance in 2014–or pay a penalty–the Congressional Budget Office estimates that only 1.4 percent of Americans will wind up paying the tax.
That is because the vast majority of us either have health insurance, or are exempted from the mandate for any one of a number of reasons. For example, at the end of 2014 you will owe no tax if:
your income is low enough that your share of premiums (after federal subsidies and employer contributions) would total more than 8 percent of your income;
your income is below the income tax filing threshold, and so you’re not required to file taxes;
you were uninsured for less than three months of the year (If over three, the penalty is pro-rated);
And 11 million of that 18 million will be low-income or middle-income Americans who are eligible for a government subsidy to help cover the cost of their premiums. Chances are, most of them will take the government up on its offer. Continue reading →
Thursday, when Chief Justice Roberts explained that the Affordable Care Act (ACA) is constitutional because the “penalty” that some Americans will have to pay is, for all practical purposes, a “tax,” you could hear tea cups shattering from Billings to Boca Raton. In conservative and libertarian circles, the initial reaction was shock, but it didn’t take long for President Obama’s opponents to rally.
The word “tax” might as well have been a pistol shot at a horse race. In the blink of an eye, Obama’s opponents were off and running, megaphones in hand, blasting the president for lying to the American people while hiking taxes under the guise of healthcare reform. Presidential candidate Mitt Romney’s campaign then began providing regular Twitter updates on the campaign contributions it was raking in following the decision. Friday, it announced that it had collected $5.5 million.