President Donald Trump’s executive order calling on central government agencies to “exercise all authority and discretion available to them to waive, defer, grant exemptions from, or delay the implementation of any provision or requirement of the Act that would impose a fiscal burden on any State or a cost, fee, tax, penalty, or regulatory burden on individuals, families, healthcare providers, health insurers, patients, recipients of healthcare services, purchasers of health insurance, or makers of medical devices, products, or medications” has had a major impact on new IRS rules for this tax filing season.
Following President Donald Trump’s executive order instructing agencies to provide relief from the health law, the Internal Revenue Service appears to be taking a more lax approach to the coverage requirement.
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.
However, it appears that though the central government could enforce the mandate, it appears that they will not be doing so. Here’s the specifics:
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.
Earlier this month, the IRS quietly altered its rules to allow the submission of 1040s with nothing on line 61. The IRS says it still maintains the option to follow up with those who elect not to indicate their coverage status, although it’s not clear what circumstances might trigger a follow up.
Napolitano said that the order directs agencies to “dial back the severity of the enforcement and [not] to punish a person or a state for what you think is their non-compliance because it might not be non-compliance in a couple of months.”
Napolitano added that he’s never before seen a president say “you will exercise your judgment against the government and in favor of the individual. That is truly revolutionary and is exactly what [Trump] promised he would do.”
He said that Trump is telling government agencies to proceed with the expectation that the law will be repealed soon, especially with regard to tax penalties.
Now, the question is, will you fill out line 61 or not? I’m not advising anyone on this. However, it seems that the IRS is now making it “voluntary” for you to answer line 61 or not.
For more information on the IRS and the illegality of the income tax and the fact that there is not one law that can be cited by the IRS that requires you file a tax return, I would encourage you to watch the fascinating video From Freedom to Fascism.
The film, America: Freedom to Fascism, was produced by Aaron Russo, who met an untimely death following the release of the film. The aim of the film was to expose the illegal nature of the income tax and the lack of forthcoming the IRS has had with the American people in failing to present the law that says anyone has to file and income tax return. If you have not seen this, it will astound you how the IRS is unwilling to point to a single law that forces Americans to file an income tax return.