July 13--Passage of the health care reform act has many Americans fearing "death panels" (a complete fabrication), billions in higher costs (nobody knows for sure), and thousands more IRS agents prowling the nation (true, but with a huge caveat).

There will be thousands more people hired by the tax collecting agency. It's the IRS that's been given the herculean task of collecting penalties from Americans who don't buy health insurance and administering tax breaks for a lot of people who do.

So you don't buy insurance and you don't pay the penalty. What happens? Not as much as you might think.

The penalty for non-compliance won't be fully phased in until 2016, when it will be $695 for each uninsured adult or 2.5 percent of family income, whichever is greater, up to $12,500.

The nonpartisan Congressional Budget Office estimates that 4 million people will pay the penalty that year. But good luck collecting all of it.

The law severely limits the IRS's ability to force compliance. There are no civil or criminal penalties for refusing to pay it and the IRS cannot seize bank accounts or dock wages to collect it. No interest accumulates for unpaid penalties.

So what's a frustrated IRS agent to do? Send out scary letters and withhold tax refunds. The former sometimes works; the later almost always works since 77 percent of all tax returns result in a refund and those average $2,707.

But jail? Not going to happen. A knock on the door? Don't worry about it.

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