In Uncategorized on 04/30/2019 at 17:13

Timothy Todd Fisher and Christina Fisher, 2019 T. C. Memo. 44, filed 4/30/19, grappling with the Premium Tax Credit of the Affordable Care Act, without doubt an enigma within a conundrum within a puzzle, brought to mind the words of Harvard scholar Thomas Andrew Lehrer above captioned. Commenting upon The New Math, Lehrer wrote (and later sang) “It’s so simple, so very simple, that only a child can do it!”

But Prof. Lehrer never met Judge Juan F. Vasquez or the three (count ‘em, three) attorneys IRS sent to unpack the alternative computation of the PTC for those who marry during the tax year wherein one spouse qualified “for honest poverty, and a’ that,” but upon wedding the other, rose above the 400% of Federal poverty (I suppose as distinguished from honest poverty) line.

Chris had a dependent child and qualified for FL exchange insurance, and concomitant PTC, for ten-and-a-half months. Then she married TT, and her fortunes brightened.

Until Reg. 1.36B-4(b)(2)(i) intervened.

“Taxpayers’ additional tax liability using the alternative computation is equal to the excess of the taxpayers’ advance PTC payments for the taxable year over the amount of the ‘alternative marriage-year credit.’  Id. subdiv. (ii)(A).  The alternative marriage-year credit is the sum of both taxpayers’ ‘alternative premium assistance amounts for the premarriage months’ and the ‘premium assistance amounts for the marriage months.’  Id.

“Taxpayers compute the alternative premium assistance amounts for premarriage months for each taxpayer and for each full or partial month the taxpayers are unmarried.  Id. subdiv. (ii)(B).  The alternative premium assistance amount for premarriage months is equal to the excess of the taxpayer’s benchmark qualified health plan premium amount over the taxpayer’s required contribution amount.  Id.; see sec. 1.36B-4(b)(5), Example (2), Income Tax Regs.  When calculating the taxpayer’s contribution amount for premarriage months, each taxpayer uses ‘one-half of the actual household income for the taxable year and treats family size as the number of individuals in the taxpayer’s family prior to the marriage.’  Sec. 1.36B-4(b)(2)(ii)(B), Income Tax Regs.; see also 1.36B-4(a)(2), Income Tax Regs.” 2019 T. C. Memo. 44, at pp. 8-9. (Footnotes omitted.)

They then do the post-marriage months, but throw in the whole family income and family size.

There’s more, but I am no math whiz. Howbeit,  Cris and TT miss the cut, and have to pay $4K that they gave to the insurer.

Judge Vasquez sympathizes, agrees it’s unfair, but that’s the law.

As this is a resolutely nonpolitical blog, I withhold comment.

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