• What is the Affordable Care Act?

    What is the Affordable Care Act?
  • The Affordable Care Act (ACA) changes the rules for health insurance. Everyone can now buy coverage. However, the law has a tax penalty for people who do not have health insurance. Coverage may also get cheaper. Many people will qualify for a new tax credits. These credits will help pay for their health insurance. Others may qualify for free coverage.

    • The Tax Penalty for Not Getting Coverage

      Under the ACA, individuals must have health insurance coverage.  There are exemptions to the requirement for health insurance coverage based on various items such as low income, availability of government sponsored programs for low income individuals, and certain religious or ethnic groups.  The penalties are the larger of $325 per person or about 2% of your income in 2015. The penalties will go up to the larger of $695 per person or almost 2.5% of your income in 2016 and increase for inflation each year after. But, you can sign up for coverage to avoid the penalty.

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    • Making Coverage More Affordable

      The ACA makes health coverage cheaper in a few ways:

      • Medicaid Expansion: Many states have expanded Medicaid. Up to now, Medicaid covered only people on the “five finger” test (i.e., or the aged, blind, disabled, children, pregnant/parenting adults). Now, many states will cover you if you are not on the five-finger test (for example, if you are an adult under 65 without children). And these states will essentially use the same income limit for everyone, regardless of which “finger” you are on. However, this varies by state.

  • Helpful Resources

    •  Want to estimate how much this new coverage may cost and how big your tax credit may be? Try the 2016 health insurance plans & prices tool on healthcare.gov.
    •  Want to know if you qualify for an exemption?  Check out the Exemptions Tool on HealthCare.gov.

    Confused by Obamacare?

    Our Tax Pros can help you sort it out.