The Individual Health Insurance Mandate: Are You in Compliance?

As part of the Affordable Care Act of 2010 (also known as Obamacare), starting in 2014 individuals are required to have health insurance. The IRS has been tasked with the responsibility of tracking who is and who is not in compliance with the law. If you do not carry “minimum essential coverage”, you may be subject to a fine.  ACA

How to Obtain Heath Coverage: In October 2013, several states and the federal health insurance exchange opened for business. These exchanges were set up to give consumers several health insurance options that would meet at least the minimum requirements and fit their needs. Despite the botched rollout of the website for the federal exchange, it is estimated that between 7 and 8 million Americans signed up for coverage before the March 31, 2014 enrollment deadline.

If you missed the open enrollment period for healthcare plans through the federal or state exchanges, not to worry; there are still plenty of other options to obtain coverage. Private health insurance can be purchased through an agent or broker throughout the year. In addition, you may qualify for a special enrollment into a government exchange plan or even an exemption.

ACA Special Enrollments: Though the enrollment period for the Obamacare exchanges technically ended on March 31 (it was actually extended until mid-April), there are still special life events and/or extenuating circumstances that may qualify you to sign up before the next open enrollment period in November 2014. These include:

  • You already signed up before mid-April but for whatever reason were unable to complete the enrollment process.
  • You got married.
  • You had a baby, adopted a child, or had a child placed in your home.
  • You lost your current health plan due to a job loss or employer terminating coverage.
  • You became a U.S. citizen or lawful permanent resident.
  • You moved to a new part of the country with different health plan options.

ACA Exemptions: If you do not wish to obtain minimum essential coverage through a private or federally sponsored health insurance plan or pay a fine to the IRS, you may qualify for an exemption.

Here are some of the groups that are exempt from the individual mandate provision of the ACA:

  • Members of a federally recognized Indian tribe.
  • People who are incarcerated.
  • Undocumented aliens.
  • People who qualify for a religious conscience exemption.
  • Hardship; current plan was canceled, cannot afford to obtain coverage, etc.
  • People below the minimum threshold for filing an income tax return.
  • Members of a recognized health care sharing ministry such as Medi-Share.

If you do not qualify for an exemption and/or do not currently have a health plan that meets the minimum coverage requirements, you will be subject to a fine when you file your taxes next year. Speak to a tax professional for further details on how to make sure you are in compliance with the Affordable Care Act.

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