 Individual Mandate | |||||||||||||||||
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|  The Affordable Care Act (ACA) requires almost every individual and each of his or her dependents to have health insurance coverage. If they do not have health insurance, they must claim an exemption or pay a tax penalty on his or her federal income taxes the following year.
What health insurance satisfies the individual mandate? You do not need to pay a penalty nor seek an exemption if you are enrolled in any of the following for the entire year:
Certain types of limited-benefits coverage satisfy the individual mandate. The penalty is waived if you have coverage for the medically needy through the Medicaid Excess Income Program, coverage through a Section 1115 Demonstration Project, line-of-duty coverage, space available care in a uniformed services facility, or Medicaid solely relating to family planning, tuberculosis, pregnancy, or emergency medical conditions. Penalties may not be waived in future years for individuals with these forms of limited-benefit coverage. The IRS outlines this “Transition Relief” in this notice (pdf). What are the exemptions from the penalty? You may qualify for an exemption from the penalty if you have experienced one of these limited situations:
You are exempt for the entire month that includes at least one day in which you have an exemption. How much will I have to pay if I don't have health insurance? In most cases, you have to pay a penalty for each month during which you did not have health insurance coverage. The penalty will depend on your individual circumstances, including your family size and household income. You can estimate your tax penalty using this online tax penalty calculator. The penalty starts in 2014 and increases over time. See the chart below for how the penalties are determined.
How can I get an exemption? Below are brief descriptions about these exemptions. Multiple exemptions may apply to your unique situation. To learn more, visit the NY State of Health online here or call them at 1-855-355-5777. Lack of Affordable Coverage You may be eligible for this exemption if you or your family members do not have access to coverage through an employer or NY State of Health that is affordable.
Hardship that Prevents You from Getting a Qualified Health Plan You may be eligible for this exemption if you experience a domestic or financial situation that causes an unexpected increase in essential expenses or if buying a plan would significantly cut into the cost of food, shelter, clothing or other necessities.
What happens when a hardship exemption ends? You may qualify for a special health insurance enrollment period. Religious Conscience Objection You may claim this exemption if you are a member of a recognized sect or division and follow established tenets or teachings of such sect or division. To apply: Submit this form (pdf) to the federal Marketplace at the address listed on the form as soon as possible. Once you secure this exemption, you do not need to reapply in future years unless you turn 21 or leave your religious sect or division. Member of a Health Care Sharing Ministry You may claim this exemption if you are a member of a health care sharing ministry. A health care sharing ministry is an organization that facilitates sharing of health care costs between individual members who have common ethical or religious beliefs in the United States. To apply: Submit this form (pdf) to the federal Marketplace at the address listed on the form as soon as possible. If you want this exemption for months in 2014 after December 2014, claim on your 2015 federal tax returns. Membership in an Indian Tribe You may claim this exemption if you are a member of a federally recognized Indian tribe or eligible for services through an Indian health care provider. To apply: Submit this form (pdf) to the federal Marketplace at the address listed on the form as soon as possible. Once you secure this exemption, you do not need to reapply in future years unless you lose tribe membership or become ineligible for Indian health services. Incarceration You may be eligible for this exemption if you are confined after the disposition of charges in a jail, prison, or similar penal institution or correctional facility. It is only available for the months you were incarcerated. To apply: Submit this form (pdf) to the federal Marketplace at the address listed on the form as soon as possible. If you want this exemption for months in 2014 after December 2014, claim on your 2015 federal tax returns. Enrolled in Coverage Between January 1, 2014 and March 31, 2014 Since the first year of open enrollment for private health insurance was until March 31, 2014, the federal government has created a special exemption that individuals can claim if they are uninsured at the beginning of 2014, but enrolled in health insurance before March 31, 2014. Read more about this exemption in this letter (pdf). To apply: No action is required. Uninsured for a Short Period of Time You may be eligible for this exemption if you have a short coverage gap of less than three months in a row. If there is more than one of these gaps in the year, you will only be granted an exemption for the first gap. If employer-based coverage is available to you, but it is on a non-calendar year enrollment, the months in 2014 before enrollment opens at your job are not counted towards the short gap in coverage’s three month maximum. To apply: Claim on your federal tax returns in April 2015. Reside Outside the United States You may claim this exemption if you are a U.S. citizen residing aboard for at least 330 days per year, or are a resident of a U.S. territory. To apply: Claim on your federal tax returns in April 2015. Household Income Below the Filing Threshold You are automatically exempt from the penalty for not obtaining health insurance if you do not earn enough to file taxes.
To apply: No action is required. Not Being Lawfully Present You are automatically exempt from the penalty if you are not a citizen or national of the U.S., or an alien lawfully present in the U.S. To apply: No action is required. Sources: NY State of Health (NYSOH) website https://nystateofhealth.ny.gov/exemptions.html Department of Health and Human Services. Patient Protection and Affordability Act; Exchange Functions; Eligibility for Exemptions; Miscellaneous Minimum Essential Coverage Provisions. Final rule. https://s3.amazonaws.com/public-inspection.federalregister.gov/2013-15530.pdf You can also learn more about the federal regulations at the IRS website on Questions and Answers on the Individual Shared Responsibility Provision of the Affordable Care Act.
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