ACA subsidy trap for people who increase their income

[Texashiker]

So technically it's 2.5 years waiting period, if everything goes smoothly. Sufficient time to die from a degenerative illness because you aren't rich and live in a red state.

Dealing with the government I seriously doubt everything is going to go ok.

The question I have, why is there a waiting period? Someone applying for disability needs help.

 

[theeedude]

Dealing with the government I seriously doubt everything is going to go ok.

The question I have, why is there a waiting period? Someone applying for disability needs help.

They can get help under Medicaid, if the state they live in isn't blocking it.

 

[IGBT]

The aca is terrible. How the dem's managed to write in tax code that actually costs people money for earning more income is amazing. Its like they hate success and want to punish people.

..punishing earners and achievers is a big part of the current day liberal agenda. Elections Have Consequences.

 

[DCal430]

They can get help under Medicaid, if the state they live in isn't blocking it.

Yep that is the only option these people have, is to try to move to a more progressive state.

 

[shira]

Why is this thread still alive?

If you under-report your income and pay too low estimated taxes, when tax time comes around and your true (higher) income is stated on your tax return, you're going to have to pay the difference between your full tax liability and the amount of taxes you actually paid during the year.

If you under-report your income and receive ACA subsidies which are too high, when tax time comes around and your true (higher) income is stated on your tax return, your going to have to pay back the difference between the tax subsidy you actually received during the year and the (lower) tax subsidy you should have received during the year.

In both cases, the effect is that you end up paying the correct net tax and receiving the correct net ACA subsidy you should have paid/received all year long.

Now, why is this completely fair result a problem?

 

[Vic]

Why is this thread still alive?

If you under-report your income and pay too low estimated taxes, when tax time comes around and your true (higher) income is stated on your tax return, you're going to have to pay the difference between your full tax liability and the amount of taxes you actually paid during the year.

If you under-report your income and receive ACA subsidies which are too high, when tax time comes around and your true (higher) income is stated on your tax return, your going to have to pay back the difference between the tax subsidy you actually received during the year and the (lower) tax subsidy you should have received during the year.

In both cases, the effect is that you end up paying the correct net tax and receiving the correct net ACA subsidy you should have paid/received all year long.

Now, why is this completely fair result a problem?

For the same reason that people who set their withholdings too low are upset they have to pay in April, or that those who set their withholdings too high are happy when they get a refund: a complete lack of understanding of basic mathematics.

 

[Texashiker]

Why is this thread still alive?

If you under-report your income and pay too low estimated taxes, when tax time comes around and your true (higher) income is stated on your tax return, you're going to have to pay the difference between your full tax liability and the amount of taxes you actually paid during the year.

Why is this thread still alive?

Because people like you fail at reading comprehension.

This is not about under reporting your income, or underestimating your income.

This is someone who tries to climb out of poverty, forgets or does not understand they need to redo their ACA subsidy and are hit with a tax bill.

What part people are going to be penalized for getting a better paying job dont you understand?

What could have fixed all of this is, is if obama would have postponed the individual mandate and enforced the business mandate. Rather than forcing companies who can afford to provide health insurance for their employees, the people who need help the most are being burdened.

 

[mugs]

Why is this thread still alive?

Because people like you fail at reading comprehension.

This is not about under reporting your income, or underestimating your income.

This is someone who tries to climb out of poverty, forgets or does not understand they need to redo their ACA subsidy and are hit with a tax bill.

What part people are going to be penalized for getting a better paying job dont you understand?

It is a normal feature of welfare programs that there comes a point where you no longer qualify. This is counteracted to an extent by the EITC, but still there are income ranges where poor people pay a very high marginal income tax rate because of the loss of government benefits. This is only a "penalty for getting a better paying job" if you think all Americans should get the same level of benefits from the government and we should replace our progressive income tax with a flat tax. If you think that, I have to ask - why do you hate poor people so much?

What could have fixed all of this is, is if obama would have postponed the individual mandate and enforced the business mandate. Rather than forcing companies who can afford to provide health insurance for their employees, the people who need help the most are being burdened.

Postponing the individual mandate wouldn't have "fixed" this (if it needed to be fixed). The individual mandate is necessary for the ACA to work; other provisions of the ACA, including the requirement that insurance companies accept anyone without discriminating against pre-existing conditions, and cover those pre-existing conditions, are dependent on the individual mandate to combat the free rider problem. This is not the case with the employer mandate.

 

[Texashiker]

This is not the case with the employer mandate.

If the employer mandate had been enforced like the individual mandate, low wage workers could get a better paying job and not have to worry about a tax penalty at the end of the year.

A person could go from working at jack in the box to working construction and the employer would have to provide health insurance.