Tax Information

Learn how your Covered California tax credits work, get forms, or find professional help filling this year.

Covered California and the Affordable Care Act Tax Requirements for Individuals and Families

The fee for not having health insurance in 2016

The fee is calculated 2 different ways – as a percentage of your household income, and per person. You’ll pay whichever is higher.

Percentage of income

  • 2.5% of household income
  • Maximum: Total yearly premium for the national average price of a Bronze plan sold through the Marketplace

Per person

  • $695 per adult
  • $347.50 per child under 18
  • Maximum: $2,085

Paying the fee

  • Using the percentage method, only the part of your household income that’s above the yearly tax filing threshold ($10,150 for individuals, $20,300 for couples filing jointly in 2014, the most recent year available) is counted.
  • Using the per-person method, you pay only for people in your household who don’t have insurance coverage.
  • If you have coverage for part of the year, the fee is 1/12 of the annual amount for each month you (or your tax dependents) don’t have coverage. If you’re uncovered only 1 or 2 months, you don’t have to pay the fee at all.
  • You pay the fee when you file your federal tax return for the year you don’t have coverage.

Most people will qualify for premium assistance tax credit, making health insurance more affordable than the fine.  Find out if you qualify.

Reconcile Advance Payments of the Premium Tax Credit

You must file a tax return to reconcile any advance  payments of the premium tax credit that were paid on your behalf and to maintain your eligibility for future premium assistance. If you do not file, you will not be eligible for future advance credit payments.

The Affordable Care Act includes the individual shared responsibility provision and the premium tax credit that may affect your tax return.

The individual shared responsibility provision requires you, your spouse, and your dependents to have qualifying health insurance for the entire year, report a health coverage exemption, or make a payment when you file.  In addition, you may be eligible for the premium tax credit if you purchased health coverage through the Health Insurance Marketplace.

Reporting Coverage

   

Claiming Coverage Exemptions

 
Most taxpayers already have qualifying health care coverage, and will simply check a box on their tax return.

  Some taxpayers are exempt from the requirement to have coverage and will not need to make a shared responsibility payment.

Claiming and Reconciling Premium Tax Credit

   

Making a Shared Responsibility Payment

 
If you purchased coverage through the Health Insurance Marketplace, you may be eligible for the premium tax credit.

  • Find out if you are eligible for the credit
  • Claim and reconcile the credit on Form 8962
  If you do not have qualifying coverage or an exemption for each month of the year, you will need to make a payment with your return.

 For additional information and for help getting the maximum tax credit, contact a Certified Agent for free confidential assistance.

Remember, that filing electronically is the easiest way to file a complete and accurate tax return as the software guides you through the filing process. Electronic filing options are available from: Taxslayer, and TurboTax.

Covered California and the Affordable Care Act Tax Requirements for Individuals and Families

The Affordable Care Act, or health care law, contains benefits and responsibilities for employers. The size and structure of your workforce – small, large, or part of a group – helps determine what applies to you. If you have no employees, the following information does not apply to you. However, other tax provisions, such as the insurance provider fee, or the branded prescription drug fee, may affect your organization. For a complete list of ACA tax provisions, visit the Affordable Care Act Tax Provisions page.

 Small Employers
 
Large Employers
 
Small employers, generally those with fewer than 50 full-time employees, may be eligible for credits and other benefits.
 

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  A large employer has 50 or more full-time employees or equivalents.
 

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How do I know if I am a small or large employer? Why does it matter?

An employer’s size is determined by the number of its employees. Employer benefits, opportunities and requirements are dependent upon the employer’s size and the applicable rules. Generally, an employer with 50 or more full-time employees or equivalents will be considered an applicable large employer.

Employers with:

Certain affiliated employers with common ownership or part of a controlled group must aggregate their employees to determine their workforce size. Proposed regulations (pdf) and FAQs also provide more information about determining the size of your workforce.

Applicable large employers can find a complete list of resources and the latest news at the Applicable Large Employer Information Center.

The employer mandate is officially part of the Employer Shared Responsibility Provision. Under the Affordable Care Act, the federal government, state governments, insurers, employers, and individuals are given shared responsibility to reform and improve the availability, quality, and affordability of Health Insurance Coverage in the United States.
IMPORTANT: If an employer owes the fee because they didn’t cover workers, it’s a flat $2,000 per full-time employee (excluding first 30 employees). If only a few end up with unaffordable coverage or if that coverage doesn’t meet minimum value standards, it’s $3,000 per full-time employee who got cost assistance (but, never more than $2,000 per full-time employee). The fee is always per-month, so it’s always 1/12 of those annual totals for each month.

  For more information about the application process check out Covered California now.