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Kogod Tax Center News

David Kautter

"[The Affordable Care Act] is enormously complex, reading through it is like working on an archeological dig, you're just going through layer after layer of law and regulations," said David Kautter, managing director of the Kogod Tax Center, testifying before Congress on Tuesday, March 5, 2013.

The video below, courtesy of the U.S. House of Representatives, shows Kautter's testimony and responses to committee questions. A video of the full hearing can be found under our Quick Links.

It would take more than 1,200 people working full time just to fill out the tax forms related to two new provisions of the new Affordable Health Care Act (ACA). The guidance issued so far by the Internal Revenue Service with respect to these two new taxes, the tax on net investment income (NII) and the additional tax on wages, is more than 48,000 words in length and consumes more than 85 pages in the Federal Register.

Kautter testified before the House of Representatives Ways and Means Subcommittee on Oversight regarding the tax-related provisions in the new healthcare act on March 5.

"The average person filing taxes already doesn't understand most of the forms they're facing; the new complexities of the ACA are a large set-back regarding tax reform and tax simplification," Kautter told the committee.

While the NII is a new tax system within the existing Internal Revenue Code, it does not include definitions of its new terminology. The IRS has decided to use existing guidelines to implement the new tax. These are the very same guidelines that make the current tax law so complicated and incomprehensible to most taxpayers, Kautter pointed out.

Both the NII and the additional tax on wages went into effect January 1, meaning taxpayers will have to account for the new provisions on their 2013 taxes.