How to Avoid the Penalty and Afford Insurance
The cost of breaking the new health care law could be more than you think. If you don't get health insurance, you'll pay a tax penalty when you file your tax return. The cost of getting health insurance may not be as much as you think. This is mostly because there is money available from the government to help people pay their premiums.
When you file your taxes, you'll be asked if you had health insurance.
If you didn't, you’ll pay a penalty that is the greater of:
- $695 for each adult and $347.50 for each child, up to $2,085 per family
- Or 2.5% of your family's income, up to a maximum of the average annual premium for a bronze level plan
However, you won't have to pay the fine for going without insurance if:
- You belong to a religion that has religious objections to insurance
- Insurance would cost more than 8.05% of your income, even with help from an employer or the tax credits
- Your income is so low that you aren't required to file a tax return ($10,000 for an individual; $20,000 for a family)
- You would have been eligible for Medicaid, but you live in a state that did not expand its program
How Insurance Can Be More Affordable
If paying for insurance is a struggle for you, you may be able to get help from the government. This money is called a subsidy. To get it:
- You must enroll in a private insurance plan through your state's Marketplace.
- The amount you make each year must meet certain rules. The good news is that some financial support may be available even if you are in a middle-income range.
For instance, you'll likely be able to get money if you make up to about $47,000 a year for one person or about $97,000 for a family of four. These income amounts are based on the federal poverty guidelines and will change every year.
How much financial help you get depends on how much money you make a year. The less you make, the more help you get.