What Does It Mean If The Penalty In Obamacare Is Declared A Tax?


Tax

Tax (Photo credit: 401K)

Yesterday was the first of 3 days of arguments in the U.S. Supreme Court over the Patient’s Protection and Affordable Care Act.  The topic yesterday is whether or not the penalty that is associated with the Individual Mandate is a tax. (Department of Health and Human Services vs. Florida.)

If it is declared a tax, the Supreme Court has the option of not making any rulings about “Obamacare” until 2015 under the 1867 Anti-Injunction Act.  That law was made during Reconstruction.  The fires of the Civil War were not completely extinguished and the United States government needed every penny available.

The Anti-Injunction Act ruling said that courts cannot rule on tax issues until after that tax has been paid.  Since the penalty for not having an “Essential Benefits” health insurance policy is paid along with a citizen’s taxes, the earliest that anyone could make a claim in court that the provision violates the constitution would be April of 2015.

In theory, if the Supreme Court decides that the penalty in “Obamacare” is a tax, all the legal wrangling could start over again in 2015.

Obviously, I was not present in the court today.  Reporters for the various news organizations were there.  Click on the links below to see what their witness was.

CNN

CBS

MSNBC

FOX

C-SPAN

S.C.O.T.U.S  (Audio of the actual arguments in the Supreme Court Of The United States)

If you like news about health insurance, “Like” my business page, The Insurance Barn.  As I learn information about insurance, I share it on that page.

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