Work Over-Time or Get a Bonus and You Could Owe the IRS $10,000

…[I]ndividuals who enroll in the ObamaCare exchange will run the risk of having to pay back a significant portion of the tax credit if their life circumstances change…

The result will be surprise bills from the IRS in the mail come tax time 2015, in the order of a couple hundred dollars all the way up to full value of any subsidy received if a family crosses the 400% FPL threshold. (This could be $10,000-$12,000 for a family of four, as an example.) Just a few dollars of extra income could result in thousands of back taxes to be paid.

Josh Archambault.

Comments (12)

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  1. G. King says:

    Another negative effect of enrolling into into the ObamaCare exchange.

  2. Perry says:

    Gosh, I’m so glad everyone’s going to have affordable insurance now!!!!(heavy on the sarcasm.)

  3. BHS says:

    For those who aren’t going to cross 400%, the whole subsidy setup really incentivizes underreporting. There are very low caps on what the IRS can ask for back – $1,500 for a family of four at 250% of the FPL.

    • Dupree says:

      And the very next sentence of your source says: “This “repayment cap” effectively encourages taxpayers to underestimate their income in order to get larger subsidies.”

      So they are encouraging massive fraud.

  4. Wally says:

    “Just a few dollars of extra income could result in thousands of back taxes to be paid.”

    This will be the next fox news headline!

  5. Steve says:

    “…the tax credits phase out quickly for those in the exchange, and are therefore unavailable for many young people (18-34) in numerous states making far less than 400% FPL…”

    Just another way ObamaCare mucked it up.