After a tumultuous beginning, the Affordable Care Act (ACA) became effective January 1, 2014. The health care act continues to be a source of confusion for many individuals and small businesses. Some of the questions that illustrate the uncertainty encompassing the ACA are:
What is the ACA and how does it affect me?
Do I need to do anything if I have coverage through my employer?
What if I can’t afford coverage through the private insurance marketplace?
How do I get coverage through ACA?
Basically, the Affordable Care Act provides health insurance coverage for individuals and families. It also provides financial assistance options for those who qualify. It’s important to note that ACA mandates that Americans must have health insurance for themselves and their dependents beginning January 1, 2014. If individuals fail to have the minimum required health insurance for themselves and their family, they will be subject to penalties when they file their 2014 tax return in 2015. The good news is that it’s not too late to purchase health insurance and be in compliance with the mandate. If you enroll by March 31, 2014, you won’t have to pay the penalty for any month of 2014.
If you have qualified health insurance you don’t have to take any additional action. Examples of qualified health insurance are:
- Medicaid or Children’s Health Insurance Program (CHIP)
- TRICARE for Life program
- Veterans’ health care
- Minimum qualified health insurance through an employer
Some individuals are exempt from the mandate. Examples of persons that are exempt include the following:
- Incarcerated individuals
- People whose incomes are so low they don’t have to file taxes
- People with household income below 100% of the federal poverty level in states that did not expand Medicaid
- People who are uninsured for a period that is less than 3 months
- People for whom health insurance is considered unaffordable (where insurance premiums after employer contributions and federal subsidies exceed 8% of family income)
- Undocumented immigrants
- Members of certain religious groups and Native American tribes
If you are not currently covered by qualified health insurance and if you are not exempt from the mandate, you may qualify for a premium assistance credit that will help to offset the cost of the insurance. But in order to qualify for the premium assistance credit, the health insurance must be purchased through the Health Insurance Marketplace. This tax credit can help make purchasing health insurance coverage more affordable for people with moderate to low incomes. For more information about your coverage options, financial assistance and the Marketplace, visit www.Healthcare.gov.
You may qualify for the credit if you meet all of the following:
- You buy health insurance through the Marketplace;
- You are ineligible for coverage through an employer or government plan;
- You are within certain income limits;
- You file a joint return, if married; and
- You cannot be claimed as a dependent by another person
For additional information on insurance options visit these links:
If you’re under 65 years of age, follow this link to find out if you may qualify for the premium assistance credit: http://drakehealth.com/site/svc/egateway?sid=175316.
If you’re 65 years and older, follow this link to find out more information: http://drakehealth.com/site/svc/egateway?sid=175316&AGE=65.
Don’t hesitate to call me at 479-966-4277 if you have any questions regarding tax implications of the ACA.