TurboTax FAQ
TurboTax FAQ
207 people found this useful

What’s the Affordable Care Act Penalty?

It’s the penalty for not having health insurance and is also known as the Shared Responsibility Payment. It only applies to the months you did not have health insurance.

The penalty is calculated two different ways—and the higher amount gets charged as the penalty:

  • Percentage of your income. For 2016, this penalty is 2.5% of your 2016 household taxable income. It applies to the whole household, regardless of how many family members went without health insurance in 2016. The maximum penalty for this method is the total yearly premium for the national average price of a Bronze plan sold through the Marketplace.
  • Per person fee. For 2016, the penalty is $695 per uninsured person for the year ($347.50 per child under 18). The maximum penalty using this method is $2,085.

If you tell us you didn’t have health insurance coverage or only had it for part of 2016, we’ll create Form 8965, calculate the penalty and also check to see if you qualify for an exemption.