ACA’s Three-Year Deadline: What It Means for You
ACA’s Three-Year Deadline: What It Means for You
The case of an individual being charged a penalty for not having health insurance for the 2015 tax year highlights an important aspect of the Affordable Care Act (ACA): its three-year deadline. This deadline applies to both the individual mandate, which requires most Americans to have health insurance, and the exemption process.
The Individual Mandate
The individual mandate requires most Americans to have health insurance coverage. Those who fail to do so may have to pay a penalty when they file their taxes. The penalty for not having health insurance is calculated based on your income and family size. For 2023, the penalty is $2,300 per adult ($4,650 for a family) and 1% of household income above the filing threshold ($73,000 for individuals, $150,000 for married couples).
The Exemption Process
There are a number of exemptions that can allow you to avoid the penalty for not having health insurance. These exemptions include:
Being uninsured for less than three months of the year.
Having low income.
Being a member of certain religious groups.
Having a hardship, such as a medical condition or financial hardship.
If you qualify for an exemption, you must file Form 8965 with your tax return. You have three years from the date you filed your original tax return to file Form 8965.
What Happens If You Miss the Deadline?
If you miss the three-year deadline for filing Form 8965, you will not be able to claim the exemption and you will have to pay the penalty. There are no exceptions to this rule.
How to Avoid Missing the Deadline
The best way to avoid missing the three-year deadline is to file Form 8965 as soon as possible after you file your original tax return. You can file Form 8965 electronically or by mail.
If you have any questions about the individual mandate or the exemption process, you should contact the IRS or a tax professional.
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