The Affordable Care Act required most uninsured Americans to purchase health insurance by the open enrollment deadline of March 31, 2014.
Those required to purchase health insurance who didn’t, may be assessed a tax penalty on their 2014 taxes filed in 2015.
If you are self-employed there is information about the Affordable Care Act you need to know since you most likely provide your own insurance.
Although there are definite perks to being self-employed — flexible hours, a comfortable office, and being your own boss to name a few, you might also be wondering, how does the Affordable Care Act (ACA) affect you?
Well sit back in your home office and relax, because TurboTax has you covered with all of the ACA information you need to know.
First, you need to figure out if you fall under the self-employed title.
You are self-employed if:
- You run a business on your own as a sole proprietor, independent contractor, or freelancer that generates income and you have no employees.
- You are a member of a partnership that carries on a trade or business.
If you run your own business and have no employees then you are considered self-employed and you are not an employer.
If this is the case and you are uninsured or want to change private health insurance you purchased, then you can get coverage through the Health Insurance Marketplace during open enrollment from November 15, 2014 to February 15, 2015.
But how do you navigate through the new health care laws and websites when it’s time to apply for health insurance?
To set you in the right direction, here are 5 tips for getting you health insurance in the Health Insurance Marketplace that fits your needs.
- Find out if you qualify for a subsidy.
Both individuals and families with yearly salaries of up to 400% of the federal poverty level may be eligible for government assistance through a subsidy also known as a premium tax credit. This comes out to around $46,000 for an individual and about $95,000 for a family of four. If you qualify for a premium tax credit, then you may be eligible to pay a lower cost per month on coverage. The premium tax credit depends on household income and family size, and this assistance can be applied right away to your health insurance premiums.
- Learn if you are eligible for a special enrollment period.
On March 31, 2014, open enrollment in the Health Insurance Marketplace ended. But you can still use the Marketplace if you are entitled to the special enrollment period. To qualify, you need to experience a major life event and complete the application process. This includes events like marriage, divorce, having a child, or moving. Or if a plan you bought outside of the Marketplace is terminated because your job status changed or for any other reason, you may also qualify for special enrollment period.
- Check if you qualify for Medicaid or the Children’s Health Insurance Program (CHIP).
You can enroll in these services at any time of year, and register right away if you are eligible. These services are often free or lower-cost options.
- Know your deductions.
If you are self-employed and paying out of pocket for your health insurance, both you and your dependents’ health care premiums are fully deductible on your tax return. As in the past, you can also continue to list unreimbursed medical expenses as deductions.
- Find out if you are exempt.
In some instances, individuals may be exempt under the Affordable Care Act. Check to find out if you fall under this category because you might be able to bypass the tax penalty associated with not purchasing health insurance by the March 31, 2014 deadline.
As with all tax laws, TurboTax is up to date and has you covered. If you have more questions about the Affordable Care Act, TurboTax Health is here to help you understand how the new health care reform law impacts you and your taxes.