The United States Supreme Court ruled that Obamacare is constitutional in National Federation of Independent Business v. Sebelius by holding that the penalty for not complying with the individual mandate to buy health insurance is actually a tax rather than a penalty. Regardless of whether you think that Obamacare is a compassionate law that will save humanity or an evil plot to shove our country into socialism the law is what it is. Most lawyers simply shrug their shoulders and admit that the law probably is a tax.
Forget for a minute that the Obama administration argues for political reasons that the law creates a penalty rather than a tax. The penalty only applies to individuals who do not purchase health insurance. The federal government unquestionably has the authority to use taxes to encourage or discourage certain behaviors and regularly does so. The penalty is based on the amount of the individual’s income and is paid to the IRS. Sounds like a tax. The amount of the penalty is determined based on a schedule that starts at $9500 in individual income and increases at the rate of approximately 2.5% of income but is capped at the cost of an Obamacare “Bronze” health plan which is estimated to cost between $4500 and $5000 in 2016 and to increase thereafter. Sounds even more like a tax.
If it walks like a duck, quacks like a duck, and looks like a duck then it probably is a duck. Love it or hate it, the Obamacare individual mandate penalty probably is a tax.
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