If you’re one of the millions of Americans that does not have employer provided health insurance, you will need to know how the Affordable Care Act (ACA) will affect you in 2016. If you don’t have health insurance or if you’re eligible for subsidies to help pay for your coverage, you may be affected by the ACA.
If you are not covered by health insurance or do not have an exemption, you will feel the impact of the ACA. The penalty for failure to comply in 2016 is the higher of 2.5% of your income above the filing threshold up to the cost of the national average premium for a bronze plan, or $695 per adult and $384.50 per child under the age of 18, up to a maximum of $2,085. This means a married couple with no children would face a maximum penalty of $1,390 and a family of four would face a maximum penalty of $2,085.
Another way the ACA could cause impact is with the premium tax credit. In order to be eligible for the premium tax credit, you cannot be eligible for employer provided health insurance, you must earn between 100% and 400% below the poverty line for a family of your size, and you must obtain your coverage through your states healthcare exchange. To view Kentucky’s healthcare exchange, visit kynect.ky.gov. For a married couple with no children, the income range for eligibility is between $15,510 and $62,040, and for a family of 4, the income range is between $23,550 and $94,200. The premium tax credit can reduce the amount you pay during the year for your monthly premiums and even lead to a larger refund at the end of the year. However, be aware that if you receive assistance towards your monthly premiums and your income is higher than what you stated in obtaining this credit, you may be responsible for paying back some or all of the credit you receive.
November 1, 2015 marks the beginning of Open Enrollment for your 2016 insurance plan through the Health Insurance Marketplace. For more information about the Affordable Care Act visit www.healthcare.gov, or contact us at 1-866-287-9604.
Posted by Stephen Heflin, CPA
