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Monday, January 19, 2015

Obamacare Penalty May Come As A Shock At Tax Time

Americans who didn't purchase health insurance last year just may be in for a very rude awakening.

As we are nearing tax reporting season, it is becoming clear that those who didn't buy health insurance, that the Obamacare law requires, may be socked with a penalty much more than the $95 touted when the law was passed.

According to the Washington Times:
The Affordable Care Act requires those who didn’t have insurance last year and didn’t qualify for one of the exemptions to pay a tax penalty, which was widely cited as $95 the first year. But the $95 is actually a minimum, and middle- and upper-income families will actually end up paying 1 percent of their household income as their penalty.
In succeeding years, the penalty will go even higher:
The penalty is designed to prod Americans to buy insurance and the penalty for not having it is scheduled to rise considerably: to a $325 minimum or 2 percent of income in 2015, and to a $695 minimum or 2.5 percent of income in 2016.
If one can afford to "eat" the penalty if their employer doesn't offer a health insurance plan or the plans offered on the state or federal exchanges are too expensive (especially if one doesn't qualify for a subsidy), the penalty may be actually cheaper in the long run. People will just have to figure what 1%, 2% and 2.5% of their incomes are.

To read more, go here.

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