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Tuesday, March 30, 2010

Yes, The Mandate Is Enforceable

The claim by the Joint Committee on Taxation that the health care mandate penalty was not enforceable by the IRS made a lot of news, but that claim made no sense to me.

The Senate bill (at p. 336) says that the health care mandate penalty “shall be assessed and collected in the same manner as an assessable penalty under subchapter B of chapter 68.”

Chapter 68B is part of subtitle F, so it made no sense to me why the JCT said (at p. 37) “The penalty is assessed through the Code and accounted for as an additional amount of Federal tax owed. However, it is not subject to the enforcement provisions of subtitle F of the Code.”

Not being a tax lawyer, I was hesitant to go out on a limb and say the JCT was flat out wrong, but I feel a little more comfortable now saying the JCT was wrong because some tax professors agree with my assessment that the JCT was wrong.

While there are some limitations on collection procedures, the mandate is enforceable by the IRS.

Related Posts:
Obamacare's Chickens Coming Home To Roost Already
Most Frivolous Pro-Mandate Argument Of The Day
The Guns & Tobacco Mandate

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  1. Ya gotta love it when things are enforceable by the IRS. Can't wait to see the regs -- I'm certain they'll bring the whole thing into clear and vivid focus.

  2. enforceable, yes.

    Constitutional - ah, that's quite another matter.

    Let's hope that the IRS doesn't hire any Oathkeepers.

  3. Is it 2013 yet? Is Paul Ryan president now and signing the repeal of the Mandate and every other part of Obamacare, ushering in a new era of economic intellectualism that he embodies?

  4. Can I make a snarky comment about not wanting to be forced into a man date?

  5. Idaho: first state to fight the healthcare mandate. This state considers it fine to mandate college students have health care...and has no understanding of the word

  6. I'm with mikehinton ... wake me when it's over, 'k?

    Gosh this stuff is scary. And what's really scary is you northern folks aren't armed. You're gonna be in a extra bad way if all this comes to pass.

  7. Well Prof. Jacobsen certainly glossed over the section of the bill that immediately precedes the line he quoted, where it says "except as provided in paragraph (2) ...." Paragraph (2) goes on to say that there will be no criminal penalties associated with failure to pay, and that there will be no "liens or levies" on taxpayer property for failure to pay.

    Tax Profs' only argument is whether IRS can still use "offsets" (e.g., refuse to pay tax refund otherwise due) to enforce.

    The Tax Profs conclude: "It would appear, nevertheless, that the prohibition against enforcement by levy is likely to create significant administrative difficulties.
    . . .
    Presumably, Congress will enact a technical correction to resolve the enforcement question some time between now and then."

    Pretty thin gruel upon which to base your blog post headline, Professor.

  8. Who are the JCT and why do we care what they say?

    Would it be foxes guarding the hen house?

    Just saying....

  9. @Jimmy, not thin gruel at all. As the link makes clear, the IRS still has numerous tools to collect, including offsets against refunds (or recalculations to lower refunds), and offsets against other monies owed by the government to the taxpayer; while a tax lien may not be filed, when the IRS sends a notice of payment due the tax lien "arises" as a matter of law and attaches to the taxpayer's property; and the IRS can commence a foreclosure suit.

    So while there are limitations (which I noted) the mandate still is enforceable in ways which will compel compliance by the vast majority of taxpayers.

  10. I do agree that the government will enforce the payment of taxes and fines this law demands.

    The larger question is how the public enforces the government to live up to its promises to perform? One week out and the flaws are already coming to the surface.

  11. Another thought. If the enforcement is agressive, does it defeat or encourage an eventual single payer system?

    I really regret the poor quality of the discourse in the main media during the last year. I do not know how anything good can come from such a dishonest process. It is like Congress got an A by cheating. The only place it pays to cheat an intellectual challenge and not get caught is school.