Obama Administration Didn't Know When Obamacare's Mandate Penalty Deadline Was Until a Tax Prep Firm Told Them



There's a terrifying detail in yesterday's Politico story about the ongoing problems with the exchanges.

The deadline to apply to enroll in health coverage and not pay a penalty next year is not the same deadline as the end of the open enrollment period, March 31. It's actually February 15. Which means that while you can still enroll after February 15, you'll have to pay the penalty for going uninsured if you finish your application after that date.

What's terrifying isn't the earlier date itself, but the facepalm-worthy fact that the administration, including the Internal Revenue Service, seems not have known about the earlier date until very recently when it was pointed out to them. From the Politico piece:

In general, Americans have until the end of March to enroll in a 2014 Obamacare plan, but to avoid a tax penalty, they'll have to sign up by mid-February. This quirk, unearthed by industry observers, appears to have gone previously unnoticed by the administration.

"The IRS didn't know that," said Jackson Hewitt Vice President Brian Haile, who recently brought the issue to the administration's attention.

The AP's Ricardo Alonso-Zaldivar actually first reported this story about a week ago. His story makes it pretty clear that the administration was surprised to learn about the earlier date, and was only made aware of it when an outside tax prep firm informed them.

So it took a private tax firm to realize—after three years of administration work on the law's implementation—what the applicable tax law really is. 

This says something about the daunting level of complexity in the tax code. And it's more than a little suggestive about the level of (in)competence that is apparently going into what is arguably the largest and most complex bureaucratic endeavor in the nation's history.