Thanks To An Executive Order From President Trump, The IRS Can No Longer Reject Your Tax Return If You Don’t Disclose Whether You Have Health Insurance

Thanks To An Executive Order From President Trump, The IRS Can No Longer Reject Your Tax Return If You Don’t Disclose Whether You Have Health Insurance

This news got lost in the kerfuffle of… well, pretty much everything else that everyone’s been freaking out about. But it’s actually quite welcome.

According to this, President Trump signed an executive order in January telling government agencies to calm their shiz when it comes to enforcing Obamacare. As for the IRS, they aren’t going to give you static if you don’t fill in the line on your tax forms that asks “Do you have health insurance?” As lawyers on CSI are fond of saying, “You don’t have to answer that.” And while this doesn’t completely get rid of the individual mandate, it does gut the thing quite a bit –

The health law’s individual mandate requires everyone to either maintain qualifying health coverage or pay a tax penalty, known as a “shared responsibility payment.” The IRS was set to require filers to indicate whether they had maintained coverage in 2016 or paid the penalty by filling out line 61 on their form 1040s. Alternatively, they could claim exemption from the mandate by filing a form 8965.

For most filers, filling out line 61 would be mandatory. The IRS would not accept 1040s unless the coverage box was checked, or the shared responsibility payment noted, or the exemption form included. Otherwise they would be labeled “silent returns” and rejected.

Instead, however, filling out that line will be optional.

“Optional.” As in, no – you don’t have to answer to the IRS whether or not you have health care coverage. Meaning that it’s not actually any of their freaking business.


Though do take note, the IRS could still follow-up with people who don’t fill out that particular line. But they won’t send back your tax returns, which is what they used to do. And they do still expect you to pay the fine if you owe it (rats…)

But still – even not being forced to answer the question is a huge step toward breaking down the mandate. And it’s certainly worth celebrating.

An IRS official spoke to and gave more details of the order what the IRS is doing with it –

But what would have been a mandatory disclosure will instead be voluntary. Silent returns will no longer be automatically rejected. The change is a direct result of the executive order President Donald Trump issued in January directing the government to provide relief from Obamacare to individuals and insurers, within the boundaries of the law.

“The recent executive order directed federal agencies to exercise authority and discretion available to them to reduce potential burden,” the IRS said in a statement to Reason. “Consistent with that, the IRS has decided to make changes that would continue to allow electronic and paper returns to be accepted for processing in instances where a taxpayer doesn’t indicate their coverage status.”

The tax agency says the change will reduce the health law’s strain on taxpayers. “Processing silent returns means that taxpayer returns are not systemically rejected, allowing them to be processed and minimizing burden on taxpayers, including those expecting a refund,” the IRS statement said.

So, ultimately what does all this mean? It means while the mandate isn’t gone, it’s significantly weakened. And that is a great sign!


Related Posts