Tags: Healthcare Reform | obamacare | ACA | taxes | exchanges | fines | coverage

Obamacare Makes Paying Taxes a Bit Trickier This Year

By    |   Monday, 19 Jan 2015 06:46 AM

The Affordable Care Act requires that Americans indicate on their federal tax forms whether they had health insurance during 2014 and whether they received tax credits to help pay for it.

Those who have no coverage may face a fine.

And many of those who received compensatory tax credits may have to reimburse the IRS if it turns out the credits they received were too large for their actual annual income.

Those who claim no subsidy — whether their coverage came from an employer, the private marketplace, or through the federal or state exchanges — need only check the box on line 61 of Form 1040 confirming they had full coverage.

The penalty for not having health coverage is 1 percent of gross income.

An often cited $95 figure is the smallest penalty amount. The average penalty for being uninsured could be closer to $301 depending on family size and income, The Washington Times reported.

"I think that a lot of people will be surprised when they get in there and find out that their penalty is [based] on their household income," Chuck Lovelace of Liberty Tax Service told the Times.

The minimum penalty amounts are set to rise to 2 percent in 2015 and 2.5 percent of income in 2016, the Times reported.

The requirement that individuals have health insurance may not be strictly enforced by the IRS this year, The Wall Street Journal reported.

"Hardship exemptions" from no-coverage penalties may be available, the Times reported.

Taxpayers who have applied for, though not yet received, exemptions from the individual mandate may write-in "pending" before sending in their forms, the Journal reported.

Besides a W-2, those who obtained their health coverage from either the federal HealthCare.gov site or from state exchanges should expect to receive 1095-A forms in the mail. These will be needed to complete their tax filing paperwork, the Times reported.

The IRS filing deadline is April 15, although extensions may be possible.

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The Affordable Care Act requires that Americans indicate on their federal tax forms whether they had health insurance during 2014 and whether they received tax credits to help pay for it, with those without coverage facing a possible fine.
obamacare, ACA, taxes, exchanges, fines, coverage
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2015-46-19
Monday, 19 Jan 2015 06:46 AM
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