Obamacare tax surprise: Millions of Americans could owe government more than they think
by: Ethan A. Huff
Tuesday, April 23, 2013
This fall, millions of already cash-strapped Americans will apply for taxpayer-funded government subsidies to help pay for their mandatory Obamacare coverage, which is set to begin next year. But according to new reports, individuals who incorrectly predict their future income on the subsidy forms, or who end up having lower income in 2012 than in 2013, will end up having to pay back some or all of the subsidy money back to the government, which could come as a major surprise for many people.
As reported by CBS News, October 1 marks the first day that Americans will be able to apply for federal government subsidies to purchase health care from private health insurance exchanges, which will reportedly be set up on a customized, state-by-state basis. But because the federal government has no idea how much income applying individuals will have next year, it can only go by this year’s income levels, which could be higher or lower than next year depending on each individual’s situation.
In other words, when next year’s tax season approaches, individuals who made more in 2013 than they did in 2012, and who qualified for health care subsidies, will have to pay a portion of those subsidies back to the government. But the vast majority of American taxpayers have no idea that this is the case, and will be unpleasantly surprised when, on top of having to purchase government health care, they learn that they owe even more money back to the federal government for the ridiculous program.