IRS Missing Key Data to Oversee Obamacare Tax Credits
The Internal Revenue Service is hampered by incomplete information from health insurance marketplaces in its efforts to oversee tax breaks for individuals in the Affordable Care Act, according to a new government report.
The report, from the Government Accountability Office, found the IRS needs to strengthen its oversight of those tax provisions.
Incomplete and delayed marketplace data limited the IRS’s ability to match taxpayers’ claims for the premium tax credit with marketplace data at the time that tax returns were filed. Complete marketplace data for the 2014 coverage year was due to the IRS in January, but thanks to marketplace delays in transmitting the data and technical difficulties at the IRS with processing the data for matching, as of March 21, 2015, the IRS had complete data available for verification of taxpayer PTC claims for only four of the 51 marketplace states (that is, the 50 states and the District of Columbia).
The IRS does not know whether these challenges are going to be for a single year or an ongoing problem, the GAO noted. According to IRS officials, the IRS checks the formatting, but not the accuracy, of the data. Although the IRS implemented contingency plans to compensate for any missing and inaccurate data, those processes were more burdensome for taxpayers, according to the GAO. Read more on Accounting Today.