March 31, 2014 was the day most Americans had to enroll in health coverage under the Affordable Care Act of 2012. In order to ensure more consumers would take the need to purchase a health care plan seriously, the Act set out the tax penalties.
H&R Block estimates the majority who remain uninsured after that deadline will qualify for a penalty waiver. However, you could be one of the four million Americans who are uninsured and the company believes who won’t qualify for a waiver and then you will face a tax penalty this year.
Penalties can start small but they do increase each year. The tax penalty for 2014 is 1% of adjusted gross income (AGI) or $95 for per adult and $47.50 for per uninsured child. However, in the new year of 2015 the penalty increase to about $325 per adults or 1% of AGI and $162.50 for per child. Researchers say that in 2016 it will rise up to about 2.5% of AGI or $695 per adult, and with the additional $347.50 for per child.
Penalties may apply if you missed the open enrollment deadline, which can trigger an event such as a job loss or a divorce. This may allow you to enroll after the open enrollment period and in addition, if you can qualify for Medicaid in your state, you will be able to enroll at any given time.
To avoid tax penalties, and to have peace of mind concerning your health, talk to your insurance agent at Brazelton Insurance Group for more information. Healthcare coverage may prove to be more affordable than most think.