Opt-Out Obamacare Penalty Can't Be Enforced -- Unless You Get a Tax Refund
October 24, 2013
RUSH: For those of us who take as long as we can to pay our taxes, October 15th was the extension filing date for 2012, and I dutifully was in there. My accountant, who is almost afraid to be my accountant because he thinks he's gonna get targeted, too, just 'cause his name's on my return, he said, "Look, you may not know this, but you keep talking about these Obamacare fines if you don't buy a policy. Do you know that under the law --" and I had to go look it up. Not that I didn't believe him, but he just never gets political with me. He stays over there. (interruption) No, no. He's not lib. It's a professional relationship.
Anyway, he said to me that, according to the law, the only way that the government can collect the fine or penalty for you not buying insurance is if you are owed a tax refund. If you do not owe a tax refund, they cannot go into your bank account or anywhere else and get that money. Now, the sad thing is that most people file their taxes to get a refund 'cause they think they're screwing the government, and they're not. You're giving the government all that money all that year, but, no, look, what it means is that it can't work. The whole point of this is the individual mandate. The guts of this are the mandate that you buy, that young, healthy people get screwed price-wise by being forced to buy insurance. You've got to.
And in three or four years, if things don't change, it's gonna be bad. I'll tell you, by then, if this thing goes forward, and it looks like it may not, but, if it goes forward, these are gonna be the good old days, because right now with the website broken, these kids can't find out how badly they're gonna get screwed, although some people are. By kids I mean 18-24, 18-30. (interruption) I know, we're gonna get to the hearings in a minute. There's nothing wrong, folks. Did you know the site's working? Everything's happening as it should. The only problem is the Republicans. That's what I meant, we're loaded here. I'm sorry to be hop-scotching all over the place. I'm trying to do an hour's worth of content here in five minutes. I really apologize. I'm bursting at the seams here.
Anyway, the website not working and therefore people losing their policies, being dropped, they don't know yet. People really don't know how they're gonna get savaged price-wise on health insurance premiums, and they're not gonna know that for a couple, three years once the fines catch up with the price. The fines are always gonna be the first preference 'cause it's so much cheaper than buying a policy.
Now, by the way, the whole point of this, Obamacare, is to fail and usher in single payer. And, as I say, Obama can't even manage to structure that right. This is glaring here, what is going on. Let me read this to you from the joint tax committee. They talk about the mandate here. "The penalty applies --" this is for not having insurance. "The penalty applies to any period the individual does not maintain minimum essential coverage and is determined monthly. The penalty is assessed through the Code," the tax code, "and accounted for as an additional amount of federal tax owed." So it's tax.
"However," look at me. "However, it is not subject to the enforcement provisions of subtitle F of the Code. The use of liens and seizures otherwise authorized for collection of taxes does not apply to the collection of this penalty. Non-compliance with the personal responsibility requirement to have health coverage is not subject to criminal or civil penalties under the Code and interest does not accrue for failure to pay [the fine] in a timely manner."
Therefore, the only way that they can collect the penalty or the fine is by taking money from your refund. If you are not owed a refund, they cannot get money from you. They can't issue a lien. They can't garnish your wages. They can't use any of the normal procedures available to them if you owe them money, even though the Supreme Court has said it's a tax. So for those of us -- I mean, folks, I'm in fat city. I'm in fat city because I always structure to where I owe money. Well, not entirely. There have been years. But if you structure your taxes so that you do not get a refund, you do not have to buy insurance and you do not have to pay a fine 'cause they can't collect it from you if you don't have a refund due. And that is just another nail in the coffin of Obamacare imploding on itself.
RUSH: Warrensburg, Missouri. This is Gary. Gary, great to have you on the EIB Network. Hello.
CALLER: Thank you, Rush. I believe you made a statement earlier that said that the only way they could collect the fine was by tax returns. Am I right?
RUSH: It's the joint tax committee, they summarized Obamacare, and they point out that the only legal way that a fine or penalty or tax can be collected from somebody who doesn't buy insurance is if they are owed a refund from the IRS on their tax return.
CALLER: Right. Well, I think you're wrong. And the reason I say that is here you have a Congress that broke the law by the 28th amendment that states that they should pass no laws on the people that they won't do themselves, and here they exempt themselves on Obamacare. So what makes people think that they won't just go into the checking accounts anyway and just take the money?
RUSH: Well, now, that's an entirely different thing. I don't disagree with you. Obama just broke the law yesterday by granting six weeks more time to sign up for Obamacare. He can't do that, unless nobody stops him. I mean, people are gonna do criminal things. Even the law says you can't rob a bank, people are gonna do it, and especially if you let them, and if you don't try to catch them and hold 'em accountable. And nobody does with Obama.
So I know what you're saying. The law says that the IRS cannot collect a fine or penalty from you unless you are owed a refund and they can take it out of that. If you're not owed a refund, they can't fine you or penalize you or tax you. Old Gary here is saying, "That's not gonna stop them. If they wanna fine you, they'll go put a lien on your bank account and get it." But Gary, the law says they can't. When's that stopped 'em, is Gary's point. I'm not arguing. I'm just telling you what Obamacare says.