Starting for the 2014 tax year, all individuals are required to have qualified health plan coverage for themselves and their dependents for every month of the year or they may face a penalty. The 2018 Tax Act reduced the penalty for not having health insurance to zero starting in 2019, but the mandate to obtain insurance is still in place. Because the penalty is zero, the IRS has removed the checkbox for required health insurance from the 1040 form in tax years 2019 thru 2025.
If you have insurance through your employer, spouse's employer, or are on Medicare, Medicaid, CHIP, or a Veterans Program, you probably have met the mandate. If you obtained healthcare through the Marketplace, then you have also met the mandate. Individuals who have insurance through the Marketplace will receive a form, 1095-A. Please include this form with your tax documents so that we can ensure that you receive any credits you may be due.
Some taxpayers may qualify for an exemption to the mandate. Such exemptions include religious preferences, individuals who are not citizens and incarcerated individuals. To qualify for these exemptions, an individual must obtain an official certification from the Marketplace.
Certain low and middle income individuals may qualify for a refundable premium assistance credit to help them pay for their insurance premiums. This credit is only available to those individuals who obtained their insurance through the Marketplace. If you met the requirements for the premium assistance credit when you signed up for your coverage, you were given an advance payment based on your projected income for the year. You must reconcile with the IRS on your current tax return whether you are entitled to more or less of the premium assistance credit. Keep in mind that you may not be qualified to receive the premium assistance credit if your household income was higher than you anticipated when you initially signed up for your coverage, and therefore you may have to pay it back. Alternatively, you may find that you were eligible for more assistance and could receive a credit.