Get Coverage Fees-exemptions

How to estimate your fee for 2017

The examples below show the 2 ways the fee for not having health insurance is calculated and compared. They are only illustrations.

Calculate your tax penalty

IMPORTANT: You’ll find out your fee only when you complete your 2016 federal tax return. (Also note the percentage-of-income examples below are based partly on 2014 information, the most recent figures available. Your 2017 fee will be based on updated information for 2017.)

Example 1: Single individual with $40,000 income

Jim, who is unmarried with no dependents, doesn’t have minimum essential coverage for any month of 2017. His household income in 2017 is $40,000.

  • Per-person fee: $695
  • Percentage-of-income fee:
    • $40,000 (2017 household income) minus $10,150 (the tax filing threshold for individuals - for 2014, the most recent figure available) = $29,850
    • 2.5% of $29,850 = $746.25

The annual national average premium for a Bronze plan is $2,448 (also based on 2014 figures).

  • $746.25 (Jim’s percentage-of-income fee) is less than $2,448 (the maximum percentage-of-income fee), so the maximum doesn’t apply.
  • $746.25 (Jim’s percentage-of-income fee) is higher than $695 (his per-person fee).

So Jim’s 2017 fee would be $746.25. He’d pay it when he files his 2017 federal income tax return, which is due in April 2018.

If Jim had minimum essential coverage for any month of 2017, he’d owe 1/12 of the annual fee for each month he’s uninsured.

Example 2: Married couple with 2 children, $70,000 income

Eduardo and Julia are married and have two children under 18. No family member has minimum essential coverage for any month of 2017. Their 2017 household income is $70,000.

  • Per-person fee: $2,085 (2 adults at $695 each, plus 2 children at $347.50 each)
  • Percentage-of-income fee:
    • $70,000 (2017 household income) minus $20,300 (the tax filing threshold for married couples filing jointly - for 2014, the most recent figure available) = $49,700
    • 2.5% of $49,700 = $1,242.50

The annual national average premium for a Bronze plan that covers the family is $9,792 (also based on 2014 figures).

  • $1,242.50 (the family’s percentage-of-income fee) is less than $9,792 (the maximum percentage-of-income fee), so the maximum doesn’t apply.
  • $2,085 (the family’s per-person fee) is higher than $1,242.50 (the family’s percentage-of-income fee).

So Eduardo and Julia’s 2018 fee would be $2,085. They’d pay it when they file their 2018 federal income tax return, which is due in April 2018.

If Eduardo and Julia’s family had minimum essential coverage for any month of 2017, they’d owe 1/12 of the annual fee for each month they’re uninsured.

Learn more about the individual shared responsibility payment from the Internal Revenue Service.

 
 

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