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Did you have health insurance in 2015? Have you signed up for a plan for 2016? Don’t assume that insurance is too expensive. Depending on your income and family size if you meet certain criteria, you may be eligible for a government tax credit or subsidy. You can find out if you’re eligible and avoid penalties by signing up at healthcare.gov.
If you did not have health insurance in 2015, you may owe a penalty on your federal income tax return. For 2015 returns, the penalty is the higher of a flat dollar amount or a percentage of your household income. The flat dollar amount is $325 per adult and $162.50 per child under age 18, up to a maximum of $975 per family. The percentage-of-income amount is 2% of household income above the filing threshold for your filing status. The maximum penalty for this calculation is based on the total annual average premium for a bronze level insurance plan purchased from the government website.
For employers who were required to provide health care information forms such as Form 1095-C to employees, the IRS extended the filing time in December 2015. The new due date is March 31. The IRS says that for 2015, you do not need to wait to receive the form. Instead, you can rely on other information to complete and file your return.
In 2016 and thereafter, the penalties for not having insurance will be:
* $695 for each adult and $347.50 for each child, but no more than $2,085 per family or 2.5% of your family yearly taxable income. Bronze-level plans will be capped at the national average for plans sold through the marketplace.
At Summit CPA we are here to assist you with all of your tax and financial needs. Contact our office at (855) 977-7623 to schedule an appointment to find out how we can make your life easier.
