Special healthcare insurance open enrollment window helps you avoid tax penalties

Submitted by gsbaird on March 10, 2015 - 10:12am

The government has opened a special health care enrollment period from March 15 to April 30 after some people who recently filed their tax returns were assessed a fee because they did not have health insurance during the 2014 calendar year as required by the Affordable Care Act.

"We recognize that this is the first tax filing season where consumers may have to pay a fee or claim an exemption for not having health insurance coverage," said Centers for Medicare & Medicaid Services Administrator Marilyn Tavenner. “Our priority is to make sure consumers understand the new requirement to enroll in health coverage and to provide those who were not aware or did not understand the requirement with an opportunity to enroll in affordable coverage this year.”

Those who want to take advantage of this opportunity to purchase a plan must:
• Not be currently enrolled in coverage for 2015
• Attest that when they filed their 2014 tax return they paid the fee for not having health coverage in 2014, and
• Attest that they first became aware of, or understood the implications of, the Shared Responsibility Payment after the end of open enrollment (February 15, 2015) in connection with preparing their 2014 taxes.

The CMS statement said:
“Americans who do not qualify for an exemption and went without health coverage in 2014 will have to pay a fee – $95 per adult or 1 percent of their income above the tax filing minimum, whichever is greater – when they file their taxes this year. The fee increases to $325 per adult or 2% of income for 2015. Individuals taking advantage of this special enrollment period will still owe a fee for the months they were uninsured (unless they can claim an exemption for those months). This special enrollment period is designed to allow such individuals the opportunity to get covered for the remainder of the year and avoid additional fees.”

Those seeking help with enrollment can contact the Marketplace help line at 800-318-2596 or can call the MedTeam toll free at 844-660-9435 or at 210-220-3966 for assistance from a certified Navigator.

When filing a tax return, use IRS Form 8965 to claim exemptions. The form can be downloaded from http://www.irs.gov/pub/irs-pdf/f8965.pdf. Instructions for completing the form and to calculate the fee, if any, owed to the IRS can be located at http://www.irs.gov/instructions/i8965/ch01.html

Many will be able to claim the exemption because Texas did not exercise its option to expand its Medicaid program to adults with incomes less that 138% of the Federal Poverty Level (FPL). Families with 2014 incomes less than those given below (for various family sizes) can claim this exemption.

Individual - $15,856, Couple - $21,404, Three - $26,951, Four - $32,499, Five - $38,047, Six - $43,594

Hardship exemptions from the requirement to purchase insurance are also allowed for reasons such as recent death of a family member, recent bankruptcy, unpaid medical bills, and domestic violence.

For a complete list of allowed exemptions, refer to https://www.healthcare.gov/exemptions-tool/#/