If you can afford health insurance, but choose not to buy it, you might have to pay a fee known as the "Individual Shared Responsibility Payment", but is also known as the "Obamacare penalty," "Obamacare fine," or "individual mandate." If it applies to you, the fee is due with your tax return for the year you didn't have coverage.
There is a list of exemptions to the individual shared responsibility payment, and if you qualify for one, you won't have to pay any penalty for not maintaining coverage. The list of exemptions and how to apply are available at the following link https://www.healthcare.gov/health-coverage-exemptions/forms-how-to-apply/
Below is a list of the exemptions from www.healthcare.gov:
- The lowest-priced coverage available to you, through either a Marketplace or job-based plan, would cost more than 8.16% of your household income.
- You don’t have to file a tax return because your income does not meet the tax filing requirement
- You had a financial hardship or other circumstances that prevented you from getting health insurance.
- You were uninsured for no more than 2 consecutive months of the year.
- You lived in a state that didn’t expand its Medicaid program and your household income was below 138% of the federal poverty level.
- You’re a member of a federally recognized tribe or eligible for services through an Indian Health Services provider.
- You’re a member of a recognized health care sharing ministry.
- You’re a member of a recognized religious sect with religious objections to insurance, including Social Security and Medicare.
- You’re incarcerated (serving a term in prison or jail).
- You’re a U.S. citizen living abroad, a certain type of non-citizen, or not lawfully present.
- A member of your tax household was born or adopted during the year. This exemption applies only to the month of the event and the month before. You can claim this exemption only if you’re also claiming another exemption.
- A member of your tax household died during the year. This exemption applies only to the month of the death and the month before. You can claim this exemption only if you’re also claiming another exemption.
The penalty is calculated in two different ways, and is assessed for any month you, your spouse, or your dependents didn't have qualifying health coverage. You'll pay the higher of the following methods for 2017:
- 2.5% of your household income, capped at the national average premium for a "Bronze" health plan sold through the marketplace. This percentage is based on the portion of your household income that's above the tax filing threshold ($10,350 and $20,700 for singles and married couples, respectively, for the 2016 tax year).
- $695 per adult and $347.50 per child under 18, up to a maximum of $2,085.
If you had coverage for part of the year, the fee is assessed at 1/12 of the calculated amount for each month you don't have coverage.
