Under the Affordable Care Act (ACA) penalties for not purchasing healthcare increases every year that the individual is not covered by healthcare. For individuals that already have any type of healthcare that was bought personally by the individual, or provided by any type of work agreement, this type of healthcare can be continued without affecting the individual. However, for other individuals who are not currently covered by healthcare, certain restrictions and penalties will apply. For 2014, a $95 charge or up to 1% of the overall income for the year will be charged to the individual. In 2015, this charge will increase to $325 per individual, or up to 2% over the overall income for the year. If the individual is still not covered by healthcare in 2016, this charge will increase to $695 or 2.5% of the overall income earned. This means that the cost of not having healthcare will increase every year by a substantial amount. In turn this takes money from the individual that could have otherwise been saved for purchasing healthcare in the first place.
Who is Exempt from these ACA penalties?
- Anyone unable to afford healthcare, meaning that the cost of healthcare would total over 8% of the yearly salary of the individual is exempt from these penalties.
- Anyone who does not earn enough money to be above the federal income tax filing threshold is exempt from these penalties.
- Anyone who is not a citizen of the United States, but is legally residing in the United States is exempt from these penalties.
- Anyone who does not lose coverage for more than three months at a time will be exempt from these penalties.
- Anyone with a religion that goes against the use of healthcare facilities, such as those that rely on spiritual healing are exempt from these penalties.
- Anyone who is a member of the health care sharing ministry is exempt from these penalties.
- Members of certain Indian tribes that will be stated at a later date will be exempt from these penalties.
- Anyone given a hardship exemption from the HHS will be exempt from these penalties.
- Anyone incarcerated in the United States prison system is exempt from these penalties.
For more information about these individual penalties see our flyer What Does the Individual Mandate Mean to Me?
Contact Morgan Planning Group, LLC if you would like our help in avoiding ACA penalties.