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Author: skorthos Three stars, 500 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121095  
Subject: ACA surcharge Date: 3/4/2014 5:04 PM
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This may be off-topic for this board and if so, I apologize in advance. Maybe you can head me in the right direction.

My wife and I have our taxes prepared by a financial services company that we have used for many years, Our connection to them came through my original tax preparer from about 30 years ago, and when he joined the company, we continued to do our tax preparation with him. He retired this year and the company hired a new tax guy to replace him.

When we received our tax packages, we found in the bill an "ACA surcharge" of $100 for each of us. We asked about it and we were told by this new tax guy that he had to create a huge, complicated spreadsheet to respond to the requirements of the Affordable Care Act. Further, his assistant had to take eight hours of courses to learn about the ACA and all of his clients were being charged this same $100.

I said that since my wife and I both had very good health insurance plans through our employers, and neither of us earned more than $200,000, or ran a company with employees, we should not need the benefits of his complicated spreadsheet nor the course work of his assistant. I suggested that he could have included checkboxes on the detailed tax questionnaire that he sent out prior to tax preparation, and those checkboxes would tell him all he needed to know about how the Affordable Care Act applied to us.

Am I wrong about this? Is everyone who uses a tax preparer paying a surcharge for the Affordable Care Act?

skorthos
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Author: vkg Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 120350 of 121095
Subject: Re: ACA surcharge Date: 3/4/2014 5:15 PM
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Not every tax preparer is charging a separate fee for "ACA" compliance. Many are probably increasing prices some to cover additional costs.

New and increased fees should have been disclosed before preparing your returns. For next year, I would fine a new tax preparer.

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Author: JAFO31 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 120351 of 121095
Subject: Re: ACA surcharge Date: 3/4/2014 5:17 PM
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skorthos: "Am I wrong about this? Is everyone who uses a tax preparer paying a surcharge for the Affordable Care Act?"

No.

No. DW and I did not pay an ACA surcharge to our preparer.

Better watch out, or next there will be a surcharge for the new/update software that must be purchased every year(or perhaps for the ongong professional development classes that must be attended annually). Sounds like nothing more than a new profit-center to me.

Regards, JAFO

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Author: ptheland Big gold star, 5000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 120352 of 121095
Subject: Re: ACA surcharge Date: 3/4/2014 5:31 PM
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Am I wrong about this? Is everyone who uses a tax preparer paying a surcharge for the Affordable Care Act?

I can see a bit of the preparer's point of view, but I agree more with yours.

The assistant's 8 hour class probably cost around $300. He should have taken a similar course, too. If it cost more, the preparer was not watching his costs very well. Besides, there's always something changing in taxes and always a need to take classes to keep up with the changes.

I can see the need to have some worksheets to deal with the ACA. But you don't have to develop those worksheets yourself. That class the assistant took likely had some sample worksheets that shouldn't have taken more than an hour or two to automate. In my case, my tax software came with some worksheets that are adequate for the bulk of my client's needs.

In the end, I'd look at the total bill rather than the details of the charges. If the bill is about the same as last year (or up by 5% or so), I wouldn't sweat it. It's just marketing garbage in an attempt to justify a fee. However if the total bill is up $100 and the only explanation is this ACA surcharge, I'd say it's time to shop for another preparer.

In my case, I increased fees by about 5% this year. I figured 3%-4% is due to general inflation and the balance is for some bit of increased complexity.

--Peter

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Author: synchronicityII Big funky green star, 20000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 120354 of 121095
Subject: Re: ACA surcharge Date: 3/4/2014 6:02 PM
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Heh, that joke "I blame it on Obama"* is actually getting adopted in real life. Fun.

-synchronicity

*- it's a running gag among many of my friends now, because employers are blaming practically anything and everything on the Affordable Care Act, even when they're doing essentially the same things they've been doing for years. So we rattle off lines like: "McDonald's forgot to put my fries in my order. I blame it on Obama" or "My car wouldn't start this morning. Damn you Obama!"

PS- regardless of what one thinks of the President and/or taxes or politics or whatnot, as we all know the tax code gets changed frequently. The ACA changes are not particularly more or less complex than those that have occurred in the past, again regardless of one's personal feelings about them from a policy perspective. As others have noted, the costs to keep up to speed should certainly not justify $100 increases in fees per tax return, if that is the case in your situation.

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Author: skorthos Three stars, 500 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 120356 of 121095
Subject: Re: ACA surcharge Date: 3/4/2014 8:22 PM
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Wow! Thank you guys for your quick responses. You have all confirmed our thoughts in different ways.

My first thought when I saw that charge was that it was opportunistic (sychronicity) and this guy was tacking on an extra charge thinking that he can score some money while shifting the blame to Obama.

My wife said at our meeting with him that it seemed to her that professionals in every field need to take classes to stay current (ptheland, JAFO31) so the fact that he had to include a new spreadsheet or his assistant had to attend a class were just part of their overhead. So, bump the fees a bit on everything.

JAFO31’s comment that in the future we might see a surcharge on every new software update was exactly what I said at our meeting.

And thank you, vkg, for putting your finger on the very thing that makes us so upset about this…the idea that we were blindsided by this new surcharge AFTER they had prepared our taxes. We now feel like we must pay them for their work, but somehow we feel violated. It is not so much about the money, it is about the feeling that they take us for chumps. We feel like we have been played.

Finally, we agree that we must find someone else to do our taxes next year. I would rather simplify them down to TurboTax and, if necessary, pay more in taxes than give this guy another dime.

Thanks again for your responses.

skorthos

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Author: geocarw Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 120357 of 121095
Subject: Re: ACA surcharge Date: 3/4/2014 8:52 PM
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And thank you, vkg, for putting your finger on the very thing that makes us so upset about this…the idea that we were blindsided by this new surcharge AFTER they had prepared our taxes. We now feel like we must pay them for their work, but somehow we feel violated. It is not so much about the money, it is about the feeling that they take us for chumps. We feel like we have been played.

You should say exactly this to the tax preparer and ask for a reduction in their fee -- never hurts to ask.

George

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Author: JeanDavid Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 120362 of 121095
Subject: Re: ACA surcharge Date: 3/5/2014 7:12 AM
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When we received our tax packages, we found in the bill an "ACA surcharge" of $100 for each of us. We asked about it and we were told by this new tax guy that he had to create a huge, complicated spreadsheet to respond to the requirements of the Affordable Care Act. Further, his assistant had to take eight hours of courses to learn about the ACA and all of his clients were being charged this same $100.

I use TaxAct for my taxes, not a paid personal tax preparer. They did not charge $100 more for the program this year, but about $18 total, which is about the same as last year.

My former employer pays United Health Care for my medical insurance and for my prescription plan.

The only thing I dislike is that I must pay $12.10 a month from my Social Security for Prescription Drug coverage even though my former employer already pays for my prescription drug coverage. I called the IRS and they say I must pay that even though I do not have Medicare part D.

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Author: TMFPMarti Big funky green star, 20000 posts Home Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 120363 of 121095
Subject: Re: ACA surcharge Date: 3/5/2014 7:33 AM
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My former employer pays United Health Care for my medical insurance and for my prescription plan.

The only thing I dislike is that I must pay $12.10 a month from my Social Security for Prescription Drug coverage even though my former employer already pays for my prescription drug coverage. I called the IRS and they say I must pay that even though I do not have Medicare part D.


Don't expect good answers from the IRS, which has nothing to do with administering Medicare. You need to talk to Medicare. On cursory reading it looks to me like the only penalty if you don't pay the income-based premium surcharge is that you lose your Part D coverage, which you don't have in the first place.

http://www.medicare.gov/part-d/costs/premiums/drug-plan-prem...

Phil
Rule Your Retirement Home Fool

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Author: 2gifts Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 120364 of 121095
Subject: Re: ACA surcharge Date: 3/5/2014 8:07 AM
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Personally, I'd make all these same complaints higher up the food chain to either see if you can get that charge removed, as it really seems bogus to me, and to let them know that although you will pay their fee this year, you will be leaving because of this.

It might make a difference, and they may adjust if they have enough complaints. It might not matter to them, but at least you will have done everything to get this corrected.

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Author: JeanDavid Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 120366 of 121095
Subject: Re: ACA surcharge Date: 3/5/2014 11:06 AM
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Personally, I'd make all these same complaints higher up the food chain to either see if you can get that charge removed, as it really seems bogus to me, and to let them know that although you will pay their fee this year, you will be leaving because of this.

It was probably the Social Security office, not the IRS that I called. But I did not voluntarily sign up for that deduction. I did voluntarily sign up for Medicare part B, and pay for that (and at surcharge rates because they think I make too much money). The only way to leave would be to cancel my Medicare, and I cannot possibly afford to do that.

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