White House Seeks to Limit Health Law’s Tax Troubles
By ROBERT PEARJAN. 31, 2015
WASHINGTON — Obama administration officials and other supporters of the Affordable Care Act say they worry that the tax-filing season will generate new anger as uninsured consumers learn that they must pay tax penalties and as many people struggle with complex forms needed to justify tax credits they received in 2014 to pay for health insurance.
The White House has already granted some exemptions and is considering more to avoid a political firestorm.
Mark J. Mazur, the assistant Treasury secretary for tax policy, said up to six million taxpayers would have to “pay a fee this year because they made a choice not to obtain health care coverage that they could have afforded.”
But Christine Speidel, a tax lawyer at Vermont Legal Aid, said: “A lot of people do not feel that health insurance plans in the marketplace were affordable to them, even with subsidies. Some went without coverage and will therefore be subject to penalties.”
Were you uninsured in 2014? It’s time to pay the piper!
Some 3 million to 6 million Americans will have to pay an Obamacare tax penalty for not having health insurance last year, Treasury officials said Wednesday. It’s the first time they have given estimates for how many people will be subject to a fine.
The penalty is $95, or 1% of income above a certain threshold (roughly $20,000 for a couple). So you could end up owing the IRS a lot of money.
Take a married couple with $100,000 in income – their bill comes to $797, according to the Tax Policy Center ACA penalty calculator.
The penalty for remaining uninsured rises to the larger of $325 or 2% of income in 2015.
NJ’s annual job growth slow, with some bright spots
JANUARY 23, 2015 LAST UPDATED: FRIDAY, JANUARY 23, 2015, 1:21 AM
BY HUGH R. MORLEY
STAFF WRITER |
THE RECORD
* State’s growth trails well behind nation’s
Four years after New Jersey reached its post-recession employment low, figures released Thursday show the state’s economic recovery continues to be slow.
The state added a modest 29,000 jobs in 2014, leaving employment far below its pre-recession peak and lower even than the level 14 years ago, according to the monthly employment report released by the New Jersey Department of Labor and Workforce Development.
The report showed New Jersey shed 400 jobs last month, even as national employment forged ahead strongly, adding 252,000 jobs in December. And although the state’s jobless rate dropped from 6.4 percent to 6.2 percent, it remains above the national figure of 5.6 percent.
The report, nevertheless, contained some positive elements, including the fact that the state added more jobs in 2014 than the previous year, despite the loss of thousands of casino jobs in Atlantic City, a very harsh winter and the lingering effects of Superstorm Sandy.
“It was a sustained, moderate pace of growth,” said Patrick O’Keefe, director of economic research at the accounting firm CohnReznick.
Rep. Scott Garrett (NJ-05) :Mr President stop creating jobs at the IRS
january 21,2015
the staff of the Ridgewood blog
WASHINGTON, D.C. – Rep. Scott Garrett (NJ-05) issued the following statement tonight after President Obama delivered his State of the Union address to Congress:
“As outlined in tonight’s speech, President Obama is pressing hard to continue to advance his ideological agenda at the expense of our economy. The president talks about bringing in ‘more revenue’ and ‘investing’ it. But you and I both know that this is a fancy way of saying he wants to tax you more so he can spend more.
“The answer isn’t higher taxes; it’s about creating more jobs. It’s time for the president to stop creating jobs at the IRS and get out of the way of the job creators in New Jersey and the rest of America. The first step in this process is working with Congress to enact real, meaningful tax reform that will lower rates, simplify the code, and close special-interest loopholes.
“Given the recent election, it’s clear that the American people are eager to get our economy back on track. They want to be rewarded for their hard work and ingenuity, they want to maximize their opportunities so they can get ahead, and they want to forge a better future for themselves and their families. Republicans in the House and Senate are in total agreement with this plan and fully expect the president to help us achieve it.
“Although we are only three weeks into the new Congress, my colleagues and I in the House have already shown that we are serious about working together to make positive changes. We have advanced several bipartisan bills that will allow Americans to find better paying jobs, help American businesses to grow, and put more money back in American taxpayers’ pockets.
“It’s time to put aside partisan politics and advance public policies that help poor and middle class Americans, not those who curry favoritism in Washington. Mr. President, join us.”
With gas prices below $2 a gallon in some parts of the state, policymakers are considering raising the gas tax. Legislators say the additional revenue would go to fund much-needed bridge and road repairs in the state. However, the public isn’t buying it. The most recent statewide survey from Fairleigh Dickinson University’s PublicMind finds respondents oppose the idea of additional taxes by a more than two-to-one margin, with many (31%) saying their opposition is driven by skepticism that the funds would be used as intended, and the belief that residents are already overburdened by taxes (45%). (PolitickerNJ)
Need help filing out your tax return? Don’t call the IRS
By STEPHEN OHLEMACHER
WASHINGTON (AP) — Filing a federal tax return is about to get more complicated for millions of families because of President Barack Obama’s health law. But they shouldn’t expect much help from the Internal Revenue Service.
Got a question for the IRS? Good luck reaching someone by phone. The tax agency says only half of the 100 million people expected to call this year will be able to reach a person.
Callers who do get through may have to wait on hold for 30 minutes or more to talk to someone who will answer only the simplest questions.
“Taxpayers who need help are not getting it, and tax compliance is likely to suffer over the longer term if these problems are not quickly and decisively addressed,” said a report Wednesday by agency watchdog Nina E. Olson.
IRS Commissioner John Koskinen says budget cuts are forcing the agency to reduce taxpayer services and other functions. The number of audits will decline, technology upgrades will be delayed and the agency might be forced to shut down and furlough workers for two days later this year, Koskinen said.
More expected to flee New Jersey as baby boomers age
For Raymond Francisco, landing a job at the General Motors auto plant in Linden at 25 years old was like winning the lottery.
The New Brunswick native was a welder by trade, and enjoyed working hard for the good money he made at the plant. But when GM announced in 2002 it would close the factory — about six years after he started — Francisco decided he had to go where the jobs were.
That meant packing up his wife, two small children and moving to Lordstown, Ohio, where GM offered him another job at an assembly plant.
People are leaving New Jersey at a higher rate than 47 other states, just behind New York, which is No. 1, and Illinois, according to James Hughes, a demographer and dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University, New Brunswick. (Kachmar/Asbury Park Press)
Tax time brings sobering surprise as health care act’s penalties kick in
JANUARY 10, 2015, 11:58 PM LAST UPDATED: SUNDAY, JANUARY 11, 2015, 12:03 AM
BY LINDY WASHBURN
STAFF WRITER |
THE RECORD
First the carrot, now the stick.
Insurance information needed for taxes
For every member of the household included on a tax return, ask:
Did you have health coverage for all of 2014? If not, was there a gap of more than three months? Did you get insurance through the federal marketplace for New Jersey, HealthCare.gov? If yes, watch for an IRS Form 1095-A, which should arrive in the mail by the end of January. It provides information about your estimated income and subsidies, which you will need to reconcile with your actual income to determine whether your subsidies were too low or too high. Those who received subsidies will need to file a Premium Tax Credit form (8962), new this year. If you did not have insurance, or had a gap in coverage longer than three months, consider whether to apply for a hardship exemption. More information, along with detailed instructions for applying for such an exemption, is available at HealthCare.gov.
Important dates
Feb. 15 is the last day to apply on the federal marketplace for New Jersey, HealthCare.gov, for coverage that starts on March 1. April 15 is the deadline for filing federal income taxes.
The Affordable Care Act rolled out last year with the promise of health coverage for those who hadn’t been able to get it before. That was the good part. Now comes the penalty phase: Those who didn’t have health coverage in 2014 will probably owe the Internal Revenue Service money this year.
As tax-filing season opens, Americans are beginning to realize that President Obama’s signature health-reform law was as much about taxes as health insurance. Experts estimate that as many as 30 million Americans — 10 percent of the population – will be affected by the changes it made in the tax code this year.
How that shakes out – how many will pay penalties or be exempted from them, how many will see their tax refunds increased or decreased by the filing day of April 15 — remains to be seen. But as ignorance and confusion give way to surprise at the law’s impact on consumers’ pocketbooks, the political repercussions could be significant.
“I’m afraid this is going to be the third strike,” said Linda Schwimmer, vice president of the New Jersey Health Care Quality Institute. First was the discovery, in the fall of 2013, that those who liked their current insurance coverage wouldn’t necessarily be able to keep it – despite President Obama’s promise to the contrary. Next was the debacle, during the first open-enrollment period, of HealthCare.gov’s computer problems. Now comes the collision of the health law and income taxes.
If the Internet becomes a public utility, you’ll pay more. Here’s why.
By Grover G. Norquist and Patrick Gleason
January 6, 2015
The Federal Communications Commission is in the middle of a high-stakes decision that could raise taxes for close to 90 percent of Americans. The commission is considering whether to reclassify broadband as a telecommunications service and, in doing so, Washington would trigger new taxes and fees at the state and local level.
The agency would like to make Internet service a public utility, placing broadband under Title II regulation of the Communications Act of 1934. This move would make broadband subject to New Deal-era regulation, and have significant consequences for U.S. taxpayers.
Under this decision to reclassify broadband, Americans would face a host of new state and local taxes and fees that apply to public utilities. These new levies, according to the Progressive Policy Institute (PPI), would total $15 billion annually. On average, consumers would pay an additional $67 for landline broadband, and $72 for mobile broadband each year, according to PPI’s calculations, with charges varying from state to state.
Lure of the South takes a toll on corporate NJ; new demographics, globalization play roles
JANUARY 7, 2015, 11:36 PM LAST UPDATED: THURSDAY, JANUARY 8, 2015, 6:28 AM
BY HUGH R. MORLEY
STAFF WRITER |
THE RECORD
Forty-five years after New Jersey’s manufacturing industry began its decline, as companies started moving their factories to the South, there are signs that the state’s corporate sector may be going the same route.
Tuesday’s announcement by Mercedes-Benz USA that it plans to move its corporate headquarters from Montvale to metro Atlanta followed similar announcements in the last 18 months by Hertz of Park Ridge, which moved to Florida’s Gulf Coast, and Sealed Air of Elmwood Park, which is moving to Charlotte, N.C.
So now three Fortune 500 companies, along with nearly 2,000 jobs, are moving or have moved to Southern locations that years ago would likely not even have been considered by corporate executives.
Though they cited reasons for their moves specific to their business or industry, it’s clear that the South now holds an attraction that it once did not. A variety of factors are in play, including lower taxes and operating costs, an improved quality of life and a stronger workforce.
“I don’t think it’s a tidal wave yet,” said James Hughes, dean of the Bloustein School of Planning & Public Policy at Rutgers University. But change is clearly afoot, he said.
“What’s changed is the perception of the South,” he said. “After the first frontier companies moved there, they proved that there is no problem securing a high-quality workforce, and that people would migrate there if there were good jobs available.”
To be sure, many companies have left New Jersey for other destinations. New York’s Rockland and Orange counties, for example, still attract a good number of companies, including Hunter Douglas and Croton Watch Co. recently. Yet the lure of the South appears to be growing.
People are fleeing N.J. faster than any other state, moving company says
By Jeff Goldman | NJ Advance Media for NJ.com
on January 05, 2015 at 1:30 PM, updated January 05, 2015 at 4:56 PM
Nearly two of every three families making an interstate move involving New Jersey last year were leaving the Garden State, the highest rate in the country.
New Jersey had the greatest percentage of outbound moves of any state nationally last year with almost 65 percent departing, according to a company which bills itself as the largest transporter of household goods in the country.
The Garden State has led the nation in outward migration for the fourth time in five years.
In all, United said it tracked 4,003 moves out of New Jersey in 2014 compared to 2,169 inbound.
Nearly half of those leaving New Jersey were bound for Florida (15 percent), California (14), Texas (9) and North Carolina (7.5), spokeswoman Melissa Sullivan told NJ Advance Media.
Retirement and jobs were the top reasons to leave the state last year, according to a United Survey of departing New Jerseyans.
About 42 percent reported leaving for a new job or company transfer. Forty-one percent attributed their move to retirement. More than half (56 percent) of people leaving New Jersey were over the age of 55, with 22 percent older than 65.
This much is true: Both President Obama and top Republicans are saying the right things about tax reform right now.
Whether that means that the two sides will make the progress in 2015 necessary to overhaul the tax code before Obama leaves office is another question entirely.
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At his year-end news conference, Obama insisted that he would put out more specific tax reform proposals in the coming months, answering GOP critics who’ve said the White House hasn’t put in the necessary work on rewriting the code.
Incoming Senate Majority Leader Mitch McConnell (R-Ky.), has said that tax reform is on the short list of issues – also including trade and infrastructure improvements – with the best chance for bipartisan cooperation once Republicans take full control on Capitol Hill in January.
And Rep. Paul Ryan (R-Wis.), who will be the House’s top tax writer next year, has said he’s willing to compromise on one of the GOP’s top priorities for reform – that the individual and corporate systems be revamped together.
A Beginner’s Guide to Austrian Economics
by Jason Peirce
“Everyone carries a part of society on his shoulders; no one is relieved of his share of responsibility by others. And no one can find a safe way out for himself if society is sweeping towards destruction. Therefore everyone, in his own interests, must thrust himself vigorously into the intellectual battle. None can stand aside with unconcern; the interests of everyone hang on the result. Whether he chooses or not, every man is drawn into the great historical struggle, the decisive battle into which our epoch has plunged us.” – Ludwig von Mises
December 16, 2014—Of course, Mises above is addressing the need for “everyone” to understand basic, sound economics. This is why it’s heartening to see such renewed interest in the Austrian School since the 2008 financial crisis.
Here is a beginner’s guide in which we’ll briefly examine the basic principles and answer the basic questions about Austrian economics.
The “Austrian School” of economics grew out of the work of the late 19th and 20th century Vienna economists Carl Menger, Eugen von Bohm-Bawerk, Ludwig von Mises, and Friedrich Hayek (though of course Austrian School economists need not hail from Austria). Austrians focus strongly on the analysis of individual human action. This is known as praxeology, the study of the logical implications of the fact that individuals act with purpose, from which all economic theory can be deduced. Austrians also note the correlation between greater economic freedom and greater political and moral freedom. This in part explains why Austrian economics is the intellectual foundation for libertarianism. Austrians rightly attribute the repeated implosions of mainstream Keynesian economics to the latter’s focus on empirical observations, mathematical models, and statistical analysis.
It’s important to note that Austrians sound a minority voice in economics and are widely marginalized by mainstream Keynesian economists in academia and media. Consider why this may be. It’s certainly not due to unsound theory. Perhaps because of academic group-think, since tenure is largely denied for Austrians? Or maybe because there is a lack of financial incentive to be Austrian, because Austrians cannot be “Jonathan Gruber-ized” and bought and sold by government, bankers, and the moneyed lobbyists and powers-that-be? What do you think?
The Austrian contributions to economic thought are best-evidenced when comparing Austrian economics to mainstream Keynesian economics. Here are 3 examples of how Austrians differ from Keynesians:
Example 1: The Role of Savings, Capital, and Prices
Keynesians assert that consumer and government spending drive economic growth and that GDP determines the strength of the economy. Seeing savings as the enemy of growth, Keynesians advocate government deficit spending, monetary inflation, and artificially low interest rates to boost “aggregate demand.” Of course, inflation, spending, and debt destroy savings, capital, and prices.
“Keynes did not teach us how to perform the ‘miracle of turning a stone into bread’ but the not-at-all miraculous procedure of eating the seed corn.” – Mises
On the other hand, Austrians rightly see that savings and production drive economic growth and determine the strength of an economy. Also, Austrians recognize that prices act as signals in the economy, and that natural interest rates and prices determine the amount of savings and production in the economy.
“The essence of Keynesianism is its complete failure to conceive the role that saving and capital accumulation play in the improvement of economic conditions.” – Mises
JANUARY 2, 2015, 11:19 PM LAST UPDATED: FRIDAY, JANUARY 2, 2015, 11:25 PM
BY HERB JACKSON
RECORD COLUMNIST |
THE RECORD
New Jersey residents and businesses paid nearly $37 billion more in federal taxes than the government sent back to the state in 2013, the second-biggest deficit in the country, new data compiled by a non-profit group show.
Another way of looking at the numbers: For every $1 paid to the Internal Revenue Service, the state got back only 68 cents in federal largess, ranking the state 48th in the nation.
It’s a picture New Jersey has seen before. And it’s not going to change anytime soon, many analysts say.
The reason has much to do with the relative wealth of New Jerseyans, compared with their counterparts in other states, officials say; the federal tax system imposes higher rates on larger incomes, and the federal social-service network directs much of its money to programs for the poor, creating the gap.
“It’s true New Jersey pays more than it gets back per person, but if you look at states at the other end of the spectrum, such as Mississippi, which is one of the most poverty-stricken, it’s much better to be in New Jersey’s position,” said Lindsay Koshgarian, the research director for the National Priorities Project, which published the latest data.
Mississippi received $4.89 in federal spending for every $1 it paid in taxes, the highest rate of any state, The Record’s analysis of the group’s data found.
