Obamacare taxes (from Affordable Care Act) will probably affect your healthcare insurance cost decision. If you do not have health insurance through your employer you need to get insurance or pay a penalty. Obamacare taxes could mean that you get a federal subsidy for your health insurance. Plus, if you own a small business you will not be required to provide health insurance. But, you could get tax credits to reduce the premium costs of any group plan you choose to offer to your employees.
- Individuals – Americans who can afford to must obtain minimum essential health coverage for 2014, get an exemption or pay a per moth fee.
- Employers – In 2015 large employers must insure full time employees or pay a per employee fee. Over half of American get their health insurance through work and the largest group of uninsured is currently the working poor.
- Advanced premium tax credits – low to middle income Americans are eligible for tax credits which reduce the upfront cost of premiums on health insurance purchased through their State’s Health Insurance Marketplace.
- Small business tax credits – small businesses may be eligible for tax credits of up to 50% of their cost of employee premiums through the Small Business Health Options Program.
2013 Obamacare Tax
- Open enrollment for the Health insurance Marketplace: The open enrollment period to purchase health care coverage through the new Health Insurance Marketplace began October 1, 2013. When you get health insurance through the marketplace, you may be able to get advance payments of the premium tax credit that will immediately help to lower your monthly premium.
- W-2 reporting of employer coverage: Certain employers are required to report the value of the health insurance coverage they provide. The value of health care coverage as reported by your employer in box 12 and identified by Code DD on your Form W-2 is not taxable.
2014 Obamacare Tax
- Premium tax credit: To claim the premium tax credit, you must get insurance through the Marketplace. You can elect to have advance payments of the tax credit sent directly to your insurer during 2014, or wait to claim the credit when you file your tax return in 2015. If you choose to have advance payments sent to your insurer, you will have to reconcile the payments on your 2014 tax return filed in 2015.
- Individual shared responsibility payment: starting January 2014, you and your family must either have health care coverage, have an exemption from coverage, or make a payment when you file your 2014 tax return in 2015. Most people already have qualifying health care coverage and will not need to do anything more than maintain that coverage throughout 2014.