Category Archives: Health Care Coverage

ACA & The Individual Shared Responsibility Payment

large-iconDid you hear about *The Individual Shared Responsibility*? 

Beginning in 2014, the individual shared responsibility provision of the Affordable Care Act requires each individual to:

  • Maintain a minimum level of health care coverage – known as minimum essential coverage, or
  • Qualify for an exemption, or
  • Make an individual shared responsibility payment when filing their federal income tax returns.

Minimum essential coverage generally includes government-sponsored programs, employer-provided health coverage, and coverage purchased in the individual market, including the Health Insurance Marketplace.  Most people already have health insurance coverage that qualifies as minimum essential coverage, and therefore will not need to make a payment if they maintain their qualified coverage. However, for each month that you or a member of your family is without minimum essential coverage and does not qualify for an exemption, you will need to make an individual shared responsibility payment.

If you and your dependents had minimum essential coverage for each month of 2014, you will check a box indicating that when you file your 2014 federal income tax return.  If you qualify for an exemption, you will attach a form to your tax return to claim that exemption.  If you are required to make the individual shared responsibility payment, you will calculate your payment and make the payment with your return.

If you choose to make an individual shared responsibility payment instead of maintaining minimum essential coverage, this means you will not have health insurance coverage to help pay for medical expenses.

In general, the individual shared responsibility payment for 2014 is the greater of:

  • One percent of your household income above the income filing threshold for your tax filing status, or
  • A flat dollar amount of $95 per adult and $47.50 per child (under age 18) in your family, but no more than $285 per family.

The individual shared responsibility payment is also capped at the cost of the national average premium for bronze level health plans available through the Marketplace that would cover everyone in your family who does not have minimum essential coverage and does not qualify for an exemption – for example, $12,240 for a family of five.  However this maximum fee will only impact the small number of high-income taxpayers who choose to go without health insurance. The payment amount is based on each individual’s personal circumstances, and information about figuring the payment can be found on our ‘Calculating the Payment’ page on IRS.gov/aca.

Example of Payment Calculation

Eduardo and Julia are married and have two children under age 18. No family member has minimum essential coverage for any month during 2014, and no family member qualifies for an exemption. For 2014, their household income is $70,000 and their tax return filing threshold amount is $20,300.

  • Using the household income formula: Subtract the tax return filing threshold amount for 2014 from the 2014 household income, then multiply the answer by one percent (0.01).
    $70,000 – $20,300 = $49,700
    One percent of $49,700 equals $497.00.
  • Using the flat dollar amount formula: Add $95 per adult for Eduardo and Julia to $47.50 per child – for their two children.
    $95.00 + $95.00 + $47.50 + $47.50 = $285.00

Eduardo and Julia’s shared responsibility payment for the year for 2014 is $497. That’s because the household income formula amount of $497 is greater than flat dollar formula amount of $285, and it is less than the $9,792 annual national average premium for bronze level coverage for a family of four in 2014. More examples can be found on IRS.gov/aca.

More Information

Find out more about the tax-related provisions of the health care law at IRS.gov/aca.

Find out more about the health care law at HealthCare.gov.

 

Source:  IRS- HCTT-2014-18

Affordable Care Act – For Individuals

 

Financial PlanAffordable Care Act has provisions for individuals who need to purchase Health Care.

New IRS Publication Helps You Find out if You Qualify for a Health Coverage Exemption

Taxpayers who might qualify for an exemption from having qualifying health coverage and making a payment should review a new IRS publication for information about these exemptions. Publication 5172, Health Coverage Exemptions, which includes information about how you get an exemption, is available on IRS.gov/aca.

The Affordable Care Act calls for each individual to have qualifying health insurance coverage for each month of the year, have an exemption, or make an individual shared responsibility payment when filing his or her federal income tax return.

You may be exempt if you:

  • Have no affordable coverage options because the minimum amount you must pay for the annual premiums is more than eight percent of your household income,
  • Have a gap in coverage for less than three consecutive months, or
  • Qualify for an exemption for one of several other reasons, including having a hardship that prevents you from obtaining coverage or belonging to a group explicitly exempt from the requirement.

On IRS.gov/ACA, you can find a comprehensive list of the coverage exemptions.

How you get an exemption depends upon the type of exemption. You can obtain some exemptions only from the Marketplace in the area where you live, others only from the IRS when you file your income tax return, and others from either the Marketplace or the IRS.

Additional information about exemptions is available on the Individual Shared Responsibility Provision web page on IRS.gov. The page includes a link to a chart that shows the types of exemptions available and how to claim them. For additional information about how to get exemptions that may be granted by the Marketplace, visit HealthCare.gov/exemptions.

Source:  Issue Number:    IRS-HC-TT-2014-19

Want Affordable Care coverage beginning March 1? Plan now for best results.

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Consumers are applying and enrolling in quality, affordable health coverage every day using HealthCare.gov and State-based Marketplaces around the country. More than 3 million have enrolled so far, and we hope millions more will do so by March 31, the end of open enrollment.

From Saturday February 15, 2014 at 3:00PM until Tuesday, February 18, 2014 at 5:00AM EST, the Social Security Administration will conduct required, regularly scheduled systems maintenance activities over the three day weekend. During this period, verification of Social Security Numbers and other related data via the Data Services Hub will be unavailable. All other services of the Hub will be functioning as normal.

What this means for you:

If you have already completed your application and know what you qualify for: This doesn’t affect you — you can continue shopping and pick a plan to finish your enrollment.

If you want coverage effective March 1, 2014: You generally need to sign up by February 15. But, because of the maintenance window, you won’t be able to find out what you qualify for if you apply after 3pm that day. If you aren’t able to complete your enrollment online by February 15, call us at 1-800-318-2596 starting on February 18 to request coverage beginning on March 1. We will work with you to get you covered.

If you want coverage with a later effective date: You can complete your application during this time but won’t be able to find out what you qualify for during the maintenance period. When you complete your application, you’ll need to save it and return to HealthCare.gov on or after February 18 to find out what you qualify for, pick a plan, and complete your enrollment.

Remember, you have until March 31 to sign up for new coverage during this year’s open enrollment period.

https://www.healthcare.gov/blog/cancelled-plan-you-ve-got-coverage-options/