The Supreme Court’s recent decision to characterize the ObamaCare individual mandate as a tax will have significant repurcussions on efforts to simplify the tax code and the tax collection “business.” In other words, it’s just going to complicate things. That’s what happens when domestic policy initiatives are enacted through this nation’s tax laws. And just as the tax code tends to be the “catch all” for implementing new policy, the IRS has consequently become that agency we constantly turn to for help with enforcing it. It must be like achieving a new position at work with new responsibilities, but no pay raise!
Under Obama’s health care reform initiative, if you do not purchase health insurance, you will be charged a “tax” that will be enforced by none other than the Internal Revenue Service. Besides adding complexity to the tax code, this new tax will be adding work to an already overburdened federal agency. The IRS has been asked to take on new responsibilities before, so there should be no question as to whether or not it will be up for the task. However, the costs will be staggering. The IRS will have to implement new procedures, hire new staff, train old staff, and otherwise do what is necessary to enforce the new health care tax.
With more and more people piling up tax debts that they can’t afford to pay, the private tax relief firms may be the only ones that stand to benefit from all this.