Obamacare imposes a tax penalty on Americans who remain without health insurance for over three months.
If you don’t have major medical health insurance that meets minimum Federal standards for more than two months in a row, you may incur a tax penalty when you file your income taxes in 2016.
Calculating Obamacare tax penalties
Tax penalties are pro-rated by the number of months you’re uninsured. In 2015, the maximum penalty was estimated to be $3,8162 for an individual by the Tax Policy Center.
In 2015, tax penalty is the greater of 2.0% of your household income above the tax filing threshold for your filing status, or $325 per adult and$162.50 per child under 18. In 2016 the maximum penalty is the greater of 2.5% of household income, or $695 per per adult ($347.50 per child under 18), up to the national average premium for a bronze plan, which was estimated to be $4,0452 for an individual by the Tax Policy Center Each year after, the fee is adjusted for inflation
This table also breaks down how the penalty would be applied each year:
|Household Size||2014 Annual Income as a Percentage of theFederal Poverty Level (FPL)|
|Family Size 1||$15,521(-$10,150) = $5,371||$29,175(-$10,150) =$19,025||$35,010(-$10,150) = $24,860||$46,680(-$10,150) = $36,530||$46,681+|
|2014 Yearly Penalty -Minimum: $95 per adult, $47.50 per child.||1.0% = Minimum $95||1.0% = $190.25||1.0% = $248.60||1.0% = $365.50||Up to $2,448 per adult1|
|2015 Yearly Penalty-Minimum: $325 per adult, $162.50 per child||2.0% = $107.42You pay = Minimum $325||2.0% = $380.50||2.0% = $497.20||2.0% = $730.60||Up to $3,8162|
|2016 Yearly Penalty– Minimum: $695 per adult, $347.50 per child||2.5% = $134.27You pay = Minimum $695||2.5% = $475.64You pay = Minimum $695||2.5% = $621.50You pay = Minimum $695||2.5% = $913.25||Up to $4,0452|
1 (As published by the IRS: http://www.irs.gov/uac/ACA-Individual-Shared-Responsibility-Provision-Calculating-the-Payment)
2 (As projected by the Tax Policy Center: http://taxpolicycenter.org/taxfacts/acacalculator.cfm)