The IRS is warning people about criminal tax preparers who are directing their clients to pay them directly for penalties connected with the Affordable Care Act, commonly called Obamacare. The Affordable Care Act provides for penalties for not having health insurance if the taxpayer does not qualify as one of the thirty million people eligible for one of the many exemptions. According to the Obama Administration as many as six million people will be owing penalties of $95 or the greater of 1% of their household income. According to H & R Block about half of its clients with subsidized marketplace coverage are having to pay a penalty. Meanwhile, unethical tax preparers are telling their clients that they are required to pay “shared responsibility” payments directly to the tax preparer if the taxpayer is uninsured. In some instances the tax preparers have even demanded payments from people who are exempt from the penalty. Legitimate tax preparers do not collect Obamacare related penalties. If money is owed as an Affordable Care Act penalty, it is included on their tax return payable to the IRS or is paid directly to the IRS by the taxpayer by April 15th. Some unscrupulous tax preparers have told their clients that if they pay the tax preparer directly, that they can lower the payment.
If you have been victimized by these scams, you should report it to the IRS on Form 14157, Complaint: Tax Return Preparer. If you have a question about whether you may owe the penalty or are eligible for one of the exemptions you can use the IRS’ Interactive Tax Assistant to determine whether or not you do owe a penalty. The link for the Interactive Tax Assistant is http://www.irs.gov/uac/AM-I-required-to-make-an-Individual-Shared-Responsibility-Payment%3F
If you do owe such a penalty, it is important to remember that you never pay it to your tax preparer.