Recent news cycles have been loaded with information concerning the I.R.S.’ scrutiny, or lack thereof, of applications for not-for-profit 501 C 4 status. Most of the noise concerns the ability of the institution to adequately manage parts of the largest healthcare overhaul since the introduction of Medicare. As the I.R.S. continues to be in the spotlight, it is helpful to understand what role they are playing in the delivery of the Affordable Care Act.

First, in 2014, individuals are going to be required to carry a minimum level of health insurance coverage or be subject to a penalty. The IRS will be the agency that is responsible for enforcing that penalty and collecting the amounts from the individuals. In addition, as part of the minimum coverage requirement for individuals and the minimum coverage requirement that employers be required to provide to individuals, there will be the need to determine whether or not individuals are eligible for a health insurance premium tax credit, and the IRS will have the responsibility for determining who is eligible for the health insurance premium tax credit.

Additionally, employers are now going to be required to provide coverage that is affordable to employees. If they do not provide this coverage, they will be subject to a penalty. The IRS is responsible for setting out the rules and guidance for employers in providing this coverage as well as enforcing the rule and collecting the penalty payment from the employers. 

In 2018 there will be a tax on what is called “Cadillac” plans, the high value cost coverage that can be provided to individuals, and the IRS will be responsible for enforcing that rule and collecting any penalties for coverage in excess of the “Cadillac” plan tax limit. In addition, starting in 2012, which would have been the W2 that was provided in January 2013, employers were now required to include certain information on annual W2s, specifically the value of the group health plan benefits. So beginning with that W2 that was provided in 2013, the IRS has now been tasked with recording all the values of the group health plan benefits that have been recorded on the W2s.

Based on these substantive issues related to the implementation of ObamaCare, there is probably not another agency within the Government that could monitor and account for such a large percentage of the gross national product. Unless the Act itself is defunded, or in some way repealed, the I.R.S. will continue to ramp up to manage and administer this massive program.