In a decision that gripped the country, the U.S. Supreme Court upheld the constitutionality of President Obama’s signature health care reform law and determined the individual mandate requiring individuals to pay a penalty if they fail to carry minimum essential health insurance is within Congress’s power. CCH has prepared a special Tax Briefing thoroughly examining the tax impact of the Court’s decision and related guidance. CCH, a Wolters Kluwer business is a leading global provider of tax, accounting and audit information, software and services.
In a landmark 5 to 4 ruling handed down on June 28, the Court determined the Patient Protection and Affordable Care Act (PPACA) and the Health Care and Education Reconciliation Act (HCERA) should move forward. However, the mechanism used to force states to expand Medicaid benefits did not pass constitutional muster.
“Many were surprised with what Chief Justice John Roberts wrote in his opinion, stating that imposing a penalty on individuals without health insurance is within the authority of Congress to levy taxes,” said Mark Luscombe, JD, LLM, CPA, and CCH Principal Federal Tax Analyst. “But it’s still not certain how the IRS will interpret parts of the law and, even with pledges by opponents to repeal the law, taxpayers have to assume key provisions will begin going into effect next year.”