The Affordable Care Act could have an impact on the way you file your income taxes for 2014. If you have already done so, then you know what we’re talking about. If not, listen up: Filing your income tax return got a tad bit more complicated this year.
ACA Exemptions, Your Taxes, and What to Know
According to government, there are many ways your experience filing an income tax return may change this year—especially related to the ACA, and especially if you’re getting/got your health care coverage thanks to the ACA.
Some of the additional steps you should expect include:
- Expect to provide additional information when filing your 2014 federal income tax return
- Expect to complete one or two new tax forms
- Expect to use one or two tax tools to find 2014 Bronze or Silver premiums to complete your tax return
Here’s what you’ll need if you, or anyone in your household, did have a health plan through the ACA Health Insurance Marketplace in 2014:
Here’s what you’ll need to do if you had health coverage from a source other than the ACA marketplace (a job, Medicare, Medicaid, or a plan you bought outside the Marketplace):
- Simply check a box reporting this on your federal income tax form (Nothing else—you won’t need to get any other forms)
The Internal Revenue Service also has a helpful chart explaining what to do depending upon your individual circumstance—and they even launched a new, online public directory of tax preparers to help you locate an expert, if you need one.
If you didn’t have 2014 health care coverage for 3 months or more, expect to apply for a health coverage exemption. ACA Exemptions are available for a variety of reasons, including certain life events, financial status, health coverage status, group membership, and more.
- You’ll qualify for a health coverage exemption.
- You’ll pay a fee when you file your 2014 federal income tax return.
Without an ACA exemption, expect to pay a fee with your tax return.
If you didn’t have coverage in 2014 and weren’t able to get an ACA exemption, expect to pay the higher of these two amounts:
- 1% of your yearly household income. (Only the amount of income above the tax-filing threshold, about $10,000 for an individual, is used to calculate the penalty. The maximum penalty is the national average premium for a Bronze plan.)
- $95 per person for the year ($47.50 per child under 18). The maximum penalty per family using this method is $285.
At NARFA, we understand that the health insurance marketplace is not an easy landscape for employers or employees to navigate. It’s often riddled with fine print, requires excessive energy to sift through, and the entire ordeal can tremendously detract from organizational objectives, overall company production capacity, and is not even guaranteed to yield the greatest coverage or value.
For these reasons, NARFA caters and specializes in servicing small businesses with fewer than 50 employees. Specifically, our breadth of industry experience and our buying power ensure that our members receive the best rates on the most comprehensive policies for medical benefits, voluntary benefits, and dental benefits. Whether you need a go-to source for business health insurance inquiries, or you’re ready to protect your employees with the best, most affordable health insurance options starting today, we encourage you to contact us, learn more, and join the NARFA family—where “there’s power in numbers.”