Health Insurance Covering Period

[Parinayakosol_5225]

My daughter got a new job, but the employer's health insurance did not kick in until 90 days later. Are these 90 days is considered no health insurance coverage for her? (This is CA Tax question)

[Vanessa A]

It depends.  In order to qualify for the Short Gap exemption, it must be LESS than 3 consecutive months.  So, if she started work on December 22 and was covered by March 22, this would meet the short gap exemption as it is LESS than 3 months.  If she did not have insurance for any day in 3 consecutive months, then this would not qualify and she would be subject to the penalty. 

[Parinayakosol_5225]

Got it, thank you.

[Parinayakosol_5225]

I discussed with my daughter on the answer, and she had additional questions. These are the detail of her situation.

1) She worked with company A until 4/25/2024 (1095-B indicated she had insurance until then)

2) She was hired by company B in 7/18/2024 and received no insurance until 10/8/2024.

     Question #1 -Does CA consider the period from 4/25/2024-10/8/2024 as no insurance coverage? Her 1095-C from the company B indicate that she had insurance in October 2024 (the coverage kick in after 90 days).

3) She quitted from company B and got a job with company C on 10/10/2024 but has no coverage from company C until 1/10/2025.

    Question #2 -Is she qualified for Short Gap Exemption from 10/10/2024-12/31/2024 (She is now has coverage with the current company)?

I need to determine her no-coverage for CA.

[Vanessa A]

Yes, the period from 4/25 to 10/8 would be considered as having no coverage.  However, since coverage is based on the month, her actual months without insurance would be May through September.  

Technically, yes, November and December would be considered a short gap.  

Since she had no job, from April through July, did she have other income?  If not, it is possible she could qualify for a hardship exemption for that time. 

[Parinayakosol_5225]

Two follow-up

1) Can I consider May-July as hardship (since she has no income at that time), and consider Aug-Oct as short gap since she got a job and her insurance kick-in before 90-days?

2) What form do I need to give the explanation?

[Vanessa A]

You will need to go to this website and then click on the link that says apply for hardship exemption.  

The general hardship exemption is done on a case by case basis, so it may or may not be able to be used for May-July.  This will depend on the outcome of her application.  The no income hardship exemption must be applied for in the year that the income is the hardship.