Find your State's Official Health Insurance Marketplace. Contact your states marketplace now to find out if you qualify for a special enrollment period. You must have coverage that started by May 1st, 2014 to avoid the per-month fee for not having health insurance.
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ObamaCare Mandate; those who choose not to purchase insurance will have to pay a tax "penalty" unless they qualify for an exemption. Exemptions from ObamaCare's tax "penalty" mandate are available to a number of Americans. Look below to see if your qualify for an exemption.
To avoid the penalty make sure you have coverage that starts by May 1st, 2014. Insurance purchased before the 15th of each month starts on the first of the following month after you have paid your premium.
"Short Coverage Gap" Exemption Update: Although the "short coverage gap" exemption allows you up to three months in a row without coverage in 2014 healthcare.gov has stated folks have until March 31st, 2014 to enroll in a marketplace plan and still avoid the fee. So you could enroll on March 31st and have coverage that starts on May 1st and still avoid being responsibility for the shared responsibility payment.
Hardship Exemption Update: If you had your plan canceled in 2014 due to the Affordable Care Act you now qualify for a hardship exemption in 2014. That means you won't have to pay the fee if you decide to go without insurance and will qualify for low premium, high out-of-pocket catastrophic plans on your State's health insurance marketplace.
The mandate's exemptions cover a variety of people, including: members of certain religious groups and Native American tribes; undocumented immigrants (who are not eligible for health insurance subsidies under the law); incarcerated individuals; people whose incomes are so low they don't have to file taxes (currently $9,500 for individuals and $19,000 for married couples); and people for whom health insurance is considered unaffordable (where insurance premiums after employer contributions and federal subsidies exceed 8% of family income); and those going without insurance for less than three months in a row.
If you belong to any of the groups listed below you are exempt from ObamaCare's mandate to "obtain minimum essential coverage" (i.e. buy insurance):
• Unaffordable coverage options Exemption. People who would have to pay more than 8 percent of their household income for health insurance
• No filing requirement. People with incomes below the threshold required for filing taxes (in 2012, $9,750 for a single person and $27,100 for a married couple with two children)
• Hardship. The Health Insurance Marketplace, also known as the Affordable Insurance Exchange, has certified that you have suffered a hardship that makes you unable to obtain coverage. (please note that if your plan was canceled due to the Affordable Care Act in 2013 you qualify for a hardship exemption in 2014 and are not thus not required to obtain coverage).
• Short Coverage Gap Exemption. If go without coverage for less than three consecutive months during the year you will not be responsible for the fee for those months. Make sure to sign up for a plan that starts by April 1st, 2014 to avoid the per month fee in 2014. Open enrollment ends March 31st, but if you sign up after March 15th your coverage won't start until May 1st, 2014 and you may be responsible for the fee for going without health coverage in April.
NOTE: There is another coverage gap exemption that applies to those who purchase marketplace insurance between March 15th and March 31st, 2014 (that coverage won't start until May 1st, 2014.)
• Religious conscience. People who qualify for religious exemptions. The Social Security Administration administers the process for recognizing these sects according to the criteria in the law.
• Health care sharing ministry. You are a member of a recognized health care sharing ministry
• Incarceration. People who are incarcerated.
• Indian tribes. Members of a federally recognized Indian tribe.
For those who can afford it and choose not to purchase health insurance the tax will be unavoidable. The money collected from these taxes goes towards funding ObamaCare and subsidizing hospitals who will have to cover unpaid emergency room visits. The money is also a down payment on your almost inevitable use of the health care system.
Check out the official IRS website on exemptions and the Individual mandate for additional details.
To avoid the fee you'll need to obtain minimum essential coverage. Most private health insurance options, Medicare, Medicaid, CHIP, TRICARE and all insurance sold on the marketplace will count as minimum essential coverage.
Most insurance types offered between each years open enrollment will be short term health insurance, fixed benefit plans and supplemental insurance will not help you avoid the fee on their own, although they will help you be covered health-wise.
Not sure if your plan will help you avoid the fee? Simply ask your insurer whether or not your plan is "ACA compliant" or counts as "minimum essential coverage".
As of December 20th 2013 HHS announced that the "hardship exemption" will exempt anyone who had their plan canceled due to the Affordable Care Act. These Americans will still be able to buy insurance and use subsidies, but they will not be responsible for the fee for going without coverage in 2014. Since they will now qualify for a hardship exemption they will also be eligible to buy a catastrophic plan through their State's marketplace. A catastrophic plan is a plan with high out-of-pocket costs but very low premiums. We at ObamaCare Facts suggest, as always, that you buy the plan that is right for you and your family and many times that plan is a silver level or higher that comes with reasonable deductibles, affordable out-of-pocket costs, and a solid insurer network.
UPDATE Canceled Plan Hardship Exemption: If you had your plan canceled due to the Affordable Care Act (your insurance company would have notified you of this) you are exempt from the mandate to buy insurance in 2014 and 2015. Also if your State and insurance company allow you, you can renew a canceled plan all the way up until October 2016.
Most exemptions will require documentation. If you cannot provide documentation you may still qualify for certain exemptions. That safest way to avoid the fee is to simply obtain health insurance. Some exemption will buy you more time to sign up (and these tend to be the ones with more flexible requirements of proof) and other exemptions will allow you to not pay the fee or have insurance (these will tend to require proof). We will keep you updated as we learn more.
Although the law says you'll need insurance by January 1st, 2014 you technically have a 3 month coverage gap exemption which will allow you up to 3 months without coverage in 2014 without being responsibility for the fee for not having insurance. Counting the grace period you can sign up for coverage that starts as late as April 1st, 2014. UPDATE: healthcare.gov lists March 31st, 2014 as your last date to enroll in a marketplace plan and avoid the fee. Since this is the official site for the marketplace we are placing this rule above all other rulings we have read including ones from the IRS. With this thinking as long as your plan starts by May 1st, 2014 you are safe.
Find your your State's Health Insurance Marketplace.
Americans who can afford to purchase insurance but chose not to will have to pay an income tax "penalty".This is officially a tax but is also referred to as a "penalty" and a "mandate". The way the ObamaCare mandate works is that any non-exempt who choose to purchase non-qualifying health insurance must pay an income tax surtax at a rate of 1% or $95 in 2014 to 2.5% in 2016 on profitable income above the tax threshold. The total penalty amount cannot exceed the national average of the annual premiums of a "bronze level" health insurance plan on ObamaCare exchanges.
The fee is a per month fee for every month you go without insurance. You have a 3 month "coverage gap" meaning you can go without minimum essential coverage for up to 3 months in a year.
The actual rules are a little more complicated depending on a number of factors including age of dependents and income. We suggested learning more about the specifics of how the Individual Mandate works if you plan to go without health insurance.
The fee for not complying with the ObamaCare Mandate will be paid on your 2014 federal tax returns. The Health Insurance Marketplace opened on Oct, 1st 2013 and coverage starting before April 1st, 2014 will ensure that you avoid paying the tax. Make sure you understand the health insurance marketplace deadlines to ensure you get a plan during open enrollment if you do not qualify for an exemption from ObamaCare's tax penalty.