If you don’t have health insurance get ready to pay up!
The affordable care act also known as ObamaCare has mandated fines for not having insurance. In 2015 the fines will rise and will be collected by the IRS.
2014 fines were $95 per person or 1% of household income (above the threshold for filing taxes), whichever is more. The fine will jump in 2015 to $325 or 2% of income, whichever is higher. By 2016 the average fine will be over $1000 according to government figures.
How is the penalty enforced? Starting 2015, individual filing a tax return for the previous tax year will indicate which members of their family, including themselves, are exempt from the individual mandate. For family members who are not exempt, the taxpayer will indicate whether they had insurance coverage. For each nonexempt family member who doesn’t have coverage, the taxpayer will owe a payment. Spouses who file a joint return are jointly liable for the penalties that apply to either or both of them. Any individual who is eligible to claim a dependent will be responsible for reporting and paying the penalty applicable to that dependent.
There are some exceptions to the individual mandate. The ACA provides nine categories of individuals who are exempt from the penalty.
- Individuals who cannot afford coverage
- Individuals who experience a hardship
- Members of a healthcare sharing ministry
- Taxpayers with income below the filing threshold
- Individuals who experience a short gap in coverage
- Incarcerated individuals
- Members of federally recognized Indian tribes
- Religious conscience objectors
- Individuals not lawfully present in the US
It is important to note that February 15th of 2015 will be the last day of open enrollment under the new health law. There are limited exceptions to enroll after that date, such as loss of employer coverage, a new child. For more information contact our office.