Obamacare is going to make next tax season way more complicated than usual, H&R Block CEO William Cobb warned Wednesday.
The Washington Examiner’s Philip Klein reports that the tax preparing giant is prepping for more confused customers faced with even more tax forms to fill out as a result of the health-care law. Cobb said on a quarterly earnings conference call Wednesday that H&R Block is already training its staff with draft forms on how to deal with Affordable Care Act subsidies and other complications. (RELATED: Tax Expert: Obamacare Screw-Ups To Make Next Tax Season ‘Most Chaotic In Years’)
“As expected, the forms are very detailed and can present significant complexity, depending on a filer’s coverage status during the year, income level, and household composition,” Cobb said. “Depending on their situation, there are instances where filers may need to file multiple new tax forms and complete additional worksheets.”
It’s not just Obamacare customers that will have to deal with the updated forms. Customers will have to face new forms concerning Obamacare’s individual mandate — either proving that they have health coverage or claiming an exemption from the requirement.
“Depending on the type of exemption, the process to claim it could be quite cumbersome and time consuming,” Cobb said on the call.
Premium tax-credit subsidies are bound to cause even more problems when taxes come due. The Obama administration didn’t create an income verification system in time for HealthCare.gov’s first open enrollment period — a problem which could leave many customers unexpectedly owing the federal government money next April.
In May, HealthCare.gov had amassed between 1.1 million and 1.5 million Obamacare applications with income-related inconsistencies, when compared to IRS data. (RELATED: House GOP Demands Treasury Stop Paying Incorrect Obamacare Subsidies)
With so many new avenues for problems, tax experts have been warning for months that next tax season will be chaotic for everyone. It’s possible that the increased confusion could boost business for tax preparers such as H&R Block.