IRS Reminds Individuals of Health Care Choices for 2014

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Everyone has important decisions to make concerning health care coverage in 2014.  Starting in 2014, you must choose to either have basic health insurance coverage (known as minimum essential coverage) for yourself and everyone in your family for each month or go without health care coverage for some or all of the year. If you don’t have coverage or if you have it but want to find out about other options; help is available at the Health Insurance Marketplace.

If you don’t maintain health insurance coverage, you will need to either seek an exemption or make an individual shared responsibility payment for the period that you are not covered with the 2014 income tax return you file in 2015.

If you choose to have health care coverage, qualifying coverage includes:

• health insurance coverage provided by your employer (including COBRA and retiree coverage),

• health insurance coverage you purchase through a Marketplace,

• Medicare, Medicaid or other government-sponsored health coverage including programs for veterans, or

• coverage you buy directly from an insurance company.

If you purchase health insurance coverage through the Marketplace, you may be eligible for financial assistance including the premium tax credit, which will help lower the out-of-pocket cost of your monthly insurance premiums.  

Qualifying coverage does not include certain coverage that may provide limited benefits, such as coverage only for vision care or dental care, workers’ compensation, or coverage only for a specific disease or condition. 

If you choose to go without coverage or experience a gap in coverage, you may qualify for an exemption if you do not have access to affordable coverage, you have a gap of less than three consecutive months without coverage, or you qualify for one of several other exemptions.  A special hardship exemption applies to individuals who purchase their insurance through the Marketplace during the initial enrollment period but due to the enrollment process have a coverage gap at the beginning of 2014.

If you (or any of your dependents) do not maintain coverage and do not qualify for an exemption, you will need to make an individual shared responsibility payment with your return. In general, the payment amount is either a percentage of your household income or a flat dollar amount, whichever is greater. You will owe 1/12th of the annual payment for each month you (or your dependents) do not have coverage and are not exempt. The annual payment amount for 2014 is the greater of:

• 1 percent of your household income that is above the tax return filing threshold for your filing status, such as Married Filing Jointly or single, or

• Your family’s flat dollar amount, which is $95 per adult and $47.50 per child, limited to a maximum of $285.

The individual shared responsibility payment is capped at the cost of the national average premium for the bronze level health plan available through the Marketplace in 2014. You will make the payment when you file your 2014 federal income tax return in 2015.

For more information about the individual shared responsibility provision and the premium tax credit, visit IRS.gov/aca. Visit the Department of Health and Human Services at HealthCare.gov for more information about health insurance coverage options and the Health Insurance Marketplace, financial assistance and exemptions.

Affordable Care Act – Individuals 

The Health Insurance Marketplace – Learn about Your Health Insurance Coverage Options

If you don’t have coverage or if you have it but want to find out about other options; help is available at the Health Insurance Marketplace. While no one is required to use the Marketplace, if you need insurance, it may be right for you. The Marketplace is where you can find health insurance coverage options that fit your budget and meet your needs. 

The Department of Health and Human Services administers the requirements for the Marketplace and the health plans they offer.

An open enrollment period to get coverage for 2014 through the Marketplace began on October 1, 2013 and runs through March 31, 2014. The start of your coverage depends upon when you enroll.

When you visit the Marketplace, you can fill out one Marketplace application to learn if you can get lower costs based on your income, compare your coverage options side-by-side, and if you choose, you can enroll in health insurance coverage.

If you purchase coverage through the Marketplace, you may be eligible for the premium tax credit. This refundable tax credit helps people with moderate incomes afford health insurance coverage they purchase through the Marketplace. 

If you are eligible for the credit, you can choose to “get it now” by having some or all of the credit paid in advance. These payments go directly to your insurance company to lower what you pay out-of-pocket for your monthly premiums during 2014. Or you “get it later” by waiting to  get the credit when you file your 2014 tax return in 2015.

For more information about your coverage options, financial assistance and the Marketplace, visit www.HealthCare.gov. Find out more about the premium tax credit, as well as other tax-related provisions of the health care law at www.IRS.gov/aca

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