Smart Benefits: New IRS Publication Tells Individuals if They’ll Pay an ACA Penalty at Tax Time
Monday, August 18, 2014
The Internal Revenue Service recently issued a Publication 5172 to help individuals understand if they qualify for an exemption to the individual health coverage requirements under the Affordable Care Act (ACA). That means they won’t have to obtain coverage – and won’t have to make a shared responsibility payment when they file their tax returns.
Who Qualifies
The ACA requires every individual to have minimum essential coverage – unless they qualify for an exemption. And an estimated 90 percent of uninsured will be able to claim an exemption. But how do individuals know?
The new publication lists exempt individuals, which include:
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLAST- Members of certain religious sects
- Certain noncitizens
- Coverage is considered unaffordable
- Household income is below the income tax return filing threshold
- Members of federally-recognized Indian tribes
- People who are incarcerated
- Those who have income below the federal poverty level
How to Claim an Exemption
Certain exemptions can only be claimed from the Marketplace in the area where individuals live, others only from the IRS, and some from either the Marketplace or the IRS. All exemptions are reported on the tax return; however, individuals are automatically exempt if they don’t have to file a return because their income is below the filing threshold
More Information
For more information on the individuals shared responsibility payment, the IRS has also released Publication 5156 and an exemption chart.
Amy Gallagher has over 21 years of healthcare industry experience guiding employers and employees. As Vice President at Cornerstone Group, she advises large employers on all aspects of healthcare reform, benefit solutions, cost-containment strategies and results-driven wellness programs. Amy speaks regularly on a variety of healthcare-related topics, and is often quoted by national publications on the subject matter. Locally, Amy is a member of SHRM-RI, the Rhode Island Business Group on Health, and the Rhode Island Business Healthcare Advisory Council.
Related Slideshow: New England’s Healthiest States 2013
The United Health Foundation recently released its 2013 annual reoprt: America's Health Rankings, which provides a comparative state by state analysis of several health measures to provide a comprehensive perspective of our nation's health issues. See how the New England states rank in the slides below.
Definitions
All Outcomes Rank: Outcomes represent what has already occurred, either through death, disease or missed days due to illness. In America's Health Rankings, outcomes include prevalence of diabetes, number of poor mental or physical health days in last 30 days, health disparity, infant mortality rate, cardiovascular death rate, cancer death rate and premature death. Outcomes account for 25% of the final ranking.
Determinants Rank: Determinants represent those actions that can affect the future health of the population. For clarity, determinants are divided into four groups: Behaviors, Community and Environment, Public and Health Policies, and Clinical Care. These four groups of measures influence the health outcomes of the population in a state, and improving these inputs will improve outcomes over time. Most measures are actually a combination of activities in all four groups.
Diabetes Rank: Based on percent of adults who responded yes to the question "Have you ever been told by a doctor that you have diabetes?" Does not include pre-diabetes or diabetes during pregnancy.
Smoking Rank: Based on percentage of adults who are current smokers (self-report smoking at least 100 cigarettes in their lifetime and currently smoke).
Obesity Rank: Based on percentage of adults who are obese, with a body mass index (BMI) of 30.0 or higher.
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