Paul L. Caron

Wednesday, June 10, 2015

TIGTA: IRS Can’t Verify Qualifications For Obamacare Subsidies

TIGTAThe Treasury Inspector General for Tax Administration yesterday released Affordable Care Act: Assessment of Internal Revenue Service Preparation for Processing Premium Tax Credit Claims (2015-43-043):

The Patient Protection and Affordable Care Act created a refundable tax credit, referred to as the Premium Tax Credit (PTC), to assist individuals with the cost of their health insurance premiums. Individuals may elect to receive the PTC in advance as partial payment for their monthly premiums (referred to as the Advance Premium Tax Credit (APTC)) or receive the PTC as a lump sum credit on their annual Federal income tax return. Beginning in January 2015, individuals are required to reconcile the APTC and can claim additional PTC on their annual tax return beginning with Tax Year 2014. ...

The overall objective of this review was to assess the status of the IRS’s preparations for verifying the accuracy of PTC claims during the 2015 Filing Season. ...

In response to the delays in receiving required Exchange Periodic Data submissions, the IRS developed contingency plans in an effort to improve its ability to ensure the accuracy of PTC claims.  However, without the required enrollment data from the Exchanges, the IRS will be unable to ensure that all taxpayers claiming the PTC bought insurance through an Exchange as required.

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Why should the IRS verify payments that (soon we will know) they were not entitled to make any way. Seems inefficient. And they are so understaffed.

Posted by: MG | Jun 10, 2015 9:28:33 AM

And this is a surprise because...

I'm still waiting for the IRS to do something about the EITC fraud.

Posted by: Dale Spradling | Jun 10, 2015 6:37:05 AM