It’s tax season again and you may be getting more than just a W2 in the mail!
By law, all individuals are required to have healthcare in order to avoid being fined a taxpenalty. For families and individuals who had health insurance through the health insurance marketplace during part or all of 2017, you will receive a 1095-A form in the mail to be used to demonstrate that you had coverage when you file taxes. You can also log in to your account on healthcare.gov to print a copy if you need yours sooner.
Here are some other things to consider:
- If you had a mix of coverage from the marketplace and other sources, you may receive multiple 1095 forms. The 1095-B form shows months covered by Medicaid and the 1095-C form shows months covered by an employer plan.
- If you received financial assistance in the form of Advance Premium Tax Credits (APTC) during 2017 with your marketplace plan, you will also be required to file form 8962. The purpose of this form is to check that your income matched your estimates and you received the correct amount of financial assistance during the year.
The 2017 tax penalty for an adult without any coverage is $695 or 2.5% of your income, whichever is higher. The penalty for a child is $347.50, but there are exceptions:
- If you had health insurance for part of the year, the penalty is pro-rated for the months covered and you will be fined less.
- If you only had 2 months without coverage, you are exempt from the penalty under the “short-gap exemption.”
- You may qualify for other exemptions, like the hardship exemption.
Depending on the type of exemption, you will need to either file directly with the marketplace or with an 8965 form through the IRS.