The affordable care act has done a great deal to stir passions in the public sphere, and with so much input regarding such a complex law there are bound to be questions regarding its tax provisions. Most people will need to do nothing. If you already have insurance from your employer, school, or government, and you continue that coverage, than you have met your tax requirements. If you do not have coverage or cannot maintain the coverage, you do have then you’ll need to get an exemption. You may qualify for an exemption if the lowest priced coverage available to you would cost more than 8% of your household income or if your income is too low to file a federal tax return. A complete list of possible exemptions can be found on the IRS website. Your tax attorney can help you determine your best options.
If you do not have coverage or qualify for an exemption, you will have to make an individual shared responsibility payment when you file your tax return. On your 2014 tax return, the payment amount is the greater of either 1% of your household income above your filling threshold or $95 per adult and $47.50 per child. The payment is capped at the family maximum of $285. The individual shared responsibility provision goes into effect in 2014 so you won’t need to report the minim essential coverage or exemptions or make any payment until you file your 2014 tax return next year. Be sure to consult your tax attorney if you have questions regarding your tax return.
Keep in mind that no one is exempted from the insurance requirement. However children are included on their parents insurance, and senior citizens qualify for Medicare part A and C both of which qualify for minimum essential coverage. Many individuals can also claim The Premium Tax Credit. The purpose of the Tax Credit is to make purchasing healthcare more affordable. You may be eligible if you purchase health insurance through the market place, are ineligible for coverage through the government or your employer, or claimed as a dependent. Taxpayers have the option of the Get It Now option that has some or all of the credit go directly to the insurance company and so lower the monthly premium. Or tax payers can Get It Later and have the credit applied to their tax return. If you have any questions call your tax attorney at 913-735-4829
