Thursday, April 29, 2010

The IRS Will Enforce Universal Healthcare

For the past several weeks, it has become official. The IRS will enforce mandatory health insurance. Starting in 2014, the IRS will make sure all American have health insurance. Under the law, any American who refuses to buy health insurance will be fine up to $700 or 2.5% of their income, whichever is higher. Yes, that means if you make $100,000 as you annual salary, you will be subjected to a fine of $2,500. It was assumed the maximum fine to be $700; but thanks to last minute amendment to the bill, the Congress added that 2.5% surtax.

Since the IRS primary enforcement role is to impose liens and levies, seizure, and give jail time against the tax cheat, they can’t take action against taxpayers who ignore the insurance mandate. But to counter that problem, the director of the IRS recommended withholding refunds from taxpayers who decline to pay the penalty. But there is a problem with that too. What happens if you don’t get a refund? Not everybody get a refund on Tax Day. What happens then?

This unwarranted expansion of the IRS is dangerous and may lead to corruptible enforcement of the law. The federal government will be putting $10 billion over the next 10 years to administer the health care law. They are planning to add over 15,000 new IRS agents to enforce the law.

In honesty, I’m not too concern with this. We know how slow and unreliable the IRS is. Have you ever called the IRS with a tax question and never could reach an IRS representative? In fact, an internal audit on telephone calls answered in the IRS has failed to meet it minimal goal. Also, by adding more responsibility into the mix, the IRS will have to cut back on audit they do, which is a good thing for us. To me, it seems stupid for us to call the IRS with health insurance question if they couldn’t answer a simple tax question. Besides, efficiency is not a good way to describe the performance of the IRS. At least they are in between the DMV and the Post Office in relation to productivity.

All in all, I am just glad that the attorneys general of many states are going to sue the federal government to challenge the legislation. In reality, the legislation is unconstitutional to mandate individuals to buy a product or receive a fine. The Constitution nowhere authorizes the United States to mandate that all citizens have to qualify for health care coverage, either directly or under threat of penalty. I am hearing the proponents of the law saying that the Constitution gives the Congress the authority to regulate commerce between states. Yes, I do agree with that, but using the commerce clause does not give the right for the government to force an individual to buy a product, especially when it entails buying insurance for the health of one’s body. If I can recall correctly, just being alive and breathing has no jurisdiction to the interstate commerce. Am I right or wrong?