Did the health insurance penalty get repealed?

[SweetieJean]

No.

[SweetieJean]

<a rel="nofollow" target="_blank" href="https://www.firstquotehealth.com/health-insurance-news/individual-mandate-in-effect/">https://www.fi...>

[SweetieJean]

Also see:
<a rel="nofollow" target="_blank" href="http://healthaffairs.org/blog/2017/08/21/the-irs-is-still-enforcing-the-individual-mandate-despite-w...>

[Ruthlilycat]

The health insurance penalty has indeed been repealed but it’s not in effect till tax year 2019.  In order to avoid paying the penalty your family AGI.

From the government website

https://www.healthcare.gov/exemptions-tool/#/results/2017/details/marketplace-affordability

“If the lowest cost Bronze-level Marketplace plan available to you in 2017 costs more than 8.16% of your annual household income, you may qualify for a health coverage exemption.”

Personally, every year I take a screenshot of the BRONZE amounts on my state’s site for my zip code.  Then I calculate how much I need  to go beneath in my charitable deductions to get below that 8.16% amt (this year’s amt).   Every year the % amount changes so it’s important to find the amt yearly.

[TaxGuyBill]

Sorry, but unless you are referring to a Qualified Charitable Distributions (QCD) from your IRA, charitable contributions do NOT affect your "Household Income" for the penalty.

Also, it is the lowest Bronze plan AFTER any Premium Tax Credit that you COULD have received.

[SweetieJean]

TGBill is correct. Household Income is before deductions, not after.
<a rel="nofollow" target="_blank" href="https://www.healthcare.gov/income-and-household-information/income/">https://www.healthcare.gov/inco...>
If you have been doing this wrong, you need to amend past returns

And note that the answer to the original question was correct at the time it was asked.

[Ruthlilycat]

“household inc” is before deductions, however that IS the method I use, and that is approved by TT software, which I am assuming questioners have.  As you know, TT software, whether online or on a CD that one downloaded tells you what you owe in taxes.  I have succesfully avoided the fine every single year using my method - using tax deductible charitable donations.

Further most middle class freelancers do not qualify for any government subsidies.

[SweetieJean]

TT does not "approve" what you did,. It uses what you enter, and has no way of knowing if your data entry is correct.

[Ruthlilycat]

Exactly.  It uses the info I have provided using my method to reduce my taxes.  Thx for your constant answers on this Jean

[TaxGuyBill]

To avoid the penalty, you check a box to indicate it is 'not affordable', but YOU do the calculations to determine that.  TurboTax does not do that calculation.

If you are factoring in charitable contributions, your calculations are wrong, and you probably do NOT qualify to waive the penalty.

[Ruthlilycat]

Yes you use the box to check not affordable however, have you used TT software?  Last year it was not necessary to check the box, it auto-calculated that for me as a user and said that our family did not have to pay a penalty - “congratulations” etc.

[TaxGuyBill]

If you qualified for the auto-calculation penalty waiver (Household Income or Gross Income is below the filling threshold, or possibly income would qualify for Medicaid but your State did not expand Medicaid) that has nothing to do with the 8.16% penalty waiver or charitable contributions.  They are completely different reasons to waive the penalty.

[Ruthlilycat]

The filing threshold this year for my area for a couple is $75480 so it will be around that amt for everyone in the USA.

[TaxGuyBill]

No, the filing threshold in 2017 for a couple who are under age 65 is $20,800.  This link shows the 2016 amounts:
<a rel="nofollow" target="_blank" href="https://www.irs.gov/publications/p501#en_US_2016_publink1000270109">https://www.irs.gov/publications...>