Month: May 6, 2024

If the taxpayer meets certain criteria, s/he may be exempt from the requirement to have qualifying health coverage. If the taxpayer is exempt, s/he will not have to make a shared responsibility payment when s/he files his/her 2014 federal income tax return in 2015. For any month that the taxpayer does not qualify for a coverage exemption, s/he will need to have minimum essential coverage or make a shared responsibility payment.

How the taxpayer gets a coverage exemption depends upon the type of exemption for which s/he is eligible. The taxpayer can obtain some exemptions only from the Marketplace while others may be claimed when the taxpayer files his/her tax return.  Some exemptions can be obtained from the Marketplace or claimed on the taxpayer's tax return. The taxpayer will report an exemption obtained from the Marketplace when s/he files his/her tax return.

The taxpayer may be exempt if:

• The minimum amount s/he must pay for the annual premiums is more than eight percent of the household income;
• S/he has a gap in coverage that is less than three consecutive months; or
• S/he qualifies for an exemption for one of several other reasons, including having a hardship that prevents him/her from obtaining coverage, or belonging to a group explicitly exempt from the requirement.

Learn more about exemptions in this chart and in questions 21-24 of our Questions and Answers. For more information on hardship exemptions, you can also visit Healthcare.gov and access HHS guidance and Questions and Answers.

The IRS is implementing new ACA Regulations for the 2015 tax filing season, based on coverages from 2014. There will be new fines, know as the Shared Responsibility Payment, for every person who went without minimum essential health coverage in 2014, unless they have qualify or have previously qualified for an exemption. For information on minimum essential coverage types, click here.

For 2014, the annual SRP amount is the greater of

● 1 percent of the household income that is above the tax return filing threshold for the taxpayer’s filing status, or
● The family’s flat dollar amount, which is $95 per adult and $47.50 per child (under age 18), limited to a family
maximum of $285.

Form 8965 must be filled out for tax returns that have people who were uninsured in 2014. Failure to fill out form 8965 can result in a delay of the tax refund being issued to the taxpayer for several months.

Select taxpayers who received a subsidy by getting insurance through the Marketplace (healthcare.gov) will receive a form by January 31, which must be entered into the software as well.

For more information, read IRS Publication 5187 or call 706-602-0275. We're here to help!