On Monday night, the Wall Street Journal reported that former U.S. representative Robert Francis O’Rourke had underpaid his taxes for 2013 and 2014. When O’Rourke released his tax returns Monday night, the Journal contacted an accountant, who noticed the error:
O’Rourke and his wife, Amy, appear to have underpaid their 2013 and 2014 taxes by more than $4,000 combined because of an error in the way they reported their medical expenses, according to tax returns the couple released Monday evening.
They took deductions for those costs without regard to the limit that only allowed that break for medical and dental expenses above 10% of income for people their age. Had they not taken the nearly $16,000 in medical deductions, their taxable income would have been higher.
But why did they over-report their medical expense deduction? If you’re curious, go and fetch a copy of the Consolidated Print of the Patient Protection and Affordable Care Act. Why, lookie what we have here:
SEC. 9013. MODIFICATION OF ITEMIZED DEDUCTION FOR MEDICAL EXPENSES.
(a) IN GENERAL.—Subsection (a) of section 213 of the Internal Revenue Code of 1986 is amended by striking ‘7.5 percent’ and inserting ‘10 percent’.
(b) TEMPORARY WAIVER OF INCREASE FOR CERTAIN SENIORS.— Section 213 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:
‘(f) SPECIAL RULE FOR 2013, 2014, 2015, AND 2016.—In the case of any taxable year beginning after December 31, 2012, and ending before January 1, 2017, subsection (a) shall be applied with respect to a taxpayer by substituting ‘7.5 percent’ for ‘10 percent’ if such taxpayer or such taxpayer’s spouse has attained age 65 be- fore the close of such taxable year.’
As one of many tax increases, Obamacare raised the medical expense deduction. Instead of allowing individuals to write off medical expenses exceeding 7.5 percent of income, individuals could only write off only medical expenses exceeding 10 percent of income—raising revenue by limiting this deduction.
However, seniors could report at the lower 7.5 percent level for 2013 through 2016. In 2013 and 2014, Robert Francis reported at the lower 7.5 percent level, even though he and his wife aren’t seniors. Oops.
Several things come to mind upon reading this news, the first being one word: SABOTAGE. Democrats frequently like to claim that the Trump administration is “sabotaging” Obamacare. But by failing to pay an Obamacare-related tax increase, Robert Francis quite literally did just that—he sabotaged the law, failing to fund its entitlements by failing to pay his newly increased tax bill.
Second, did Robert Francis ever bother to READ Obamacare? Sure, he wasn’t a congressman when the bill passed, because he wasn’t a congressman for long, but one would think a member of Congress would bother to educate himself about such an important, and visible, piece of legislation. I talked several times with my mother, a senior who uses the medical expense deduction, about the import of this provision on her taxes. But then again, I actually bothered to read the bill.
Third, Robert Francis should remind himself that, if congressmen need to hire an accountant to do their taxes, maybe he should think about coming up with a simpler tax code? I wrote about this issue in a different context last year—millennials with children themselves who still have their parents do their taxes for them—but the same principle applies. Granted, an accountant helps prepare my return, but I know where every item on my return came from, and I even prepare a draft return before my accountant does, so I have an early idea where I stand with the IRS.
More to the point, this episode once again reveals how Democrats want to bequeath to the nation laws that they do not understand. Recall that Max Baucus (D-MT), then the chairman of the Senate Finance Committee and a main author of Obamacare, said he didn’t need to bother reading the bill because he hired “experts” to do it for him. Except that one of those supposed “experts” admitted four years later that, on the law’s employer mandate, “we didn’t have a very good handle on how difficult operationalizing that provision would be at that time.” A government too big to manage—that’s liberals’ greatest legacy.
As James Madison reminded us in Federalist 51, “In framing a government which is to be administered by men over men, the great difficulty lies in this: You must first enable the government to control the governed, and in the next place oblige it to control itself.” Maybe Robert Francis should think about that the next time he’s out on the campaign trail—or writing that check for back taxes to the IRS.