As we approach the dreaded tax filing deadline of April 15th, many Americans are ill-prepared for the news they are going to receive from their tax preparers or tax preparation software. Between three and six million people are going to be affected by penalties, an “Individual Shared Responsibility Payment,” associated with the Affordable Care Act. And most of those affected have no idea how much financial pain they are going to feel.
When the Obama Administration was selling Obamacare to the American people – you remember, “It’s not a tax,” “If you like your healthcare plan you can keep it,” “We have to pass the bill to find out what’s in it,” etc. – they alluded to the existence of penalties for those Americans who did not purchase ACA compliant health insurance. The amount for the first year non-compliance penalty was routinely quoted as $95. For many the choice was clear: keep the non-compliant health insurance, pay the $95 penalty (read: non-compliance tax), and hope that a Republican-led Congress would affect relief for the taxpayer as soon as they took control in Washington, DC.