The ObamaCare Tax Penalty is an individual mandate, a requirement for those individuals who do not have health insurance. A penalty will be applied to your taxable income, and is set at 1% to 2.5% of your income or a set penalty, whichever is greater. The amount will be paid on your taxes at the end of the year. The current rates are set as follows:
2014: $95 per person at 1%
2015: $325 per person at 2%
2016: $695 per person at 2.5%
2017: 2.5% or increased with inflation
Subsidies Available
ObamaCare subsidies are aimed at individuals with incomes between 139% to 400% of the Federal Poverty Level (FLP). The current 139% FLP is $23,050 for a family of four and the 400% FLP is $92,200. Those who fall within these categories will be eligible for insurance. However, the more income the family has, the less assistance available. Subsidies are given as refundable tax credits.
Exemptions
- individuals who have to pay more than 8% of their income for health insurance
- individuals with incomes below the threshold for filing taxes
- individuals who qualify for religious exemptions
- Undocumented immigrants
- Incarcerated individuals
- Members of Native American tribes
For those who can afford to pay for medical insurance, the tax will be unavoidable.
Why?
The money from these taxes goes towards funding ObamaCare and subsidizing hospitals that must cover unpaid ER visits.
As always, if you have any questions, please feel free to contact me via email tinataxpro@softcom.net or phone at (209) 329-1255.
Have a great week!