Health Care Real Talk Series: I Don’t Have Health Insurance, but I Can’t Afford a Penalty Read the Article Open Share Drawer Share this:Click to share on Facebook (Opens in new window)Click to share on Twitter (Opens in new window)Click to share on LinkedIn (Opens in new window)Click to share on Pinterest (Opens in new window)Click to print (Opens in new window) Written by TurboTaxLisa Published Jan 13, 2017 2 min read Q. I missed the window to sign up for health insurance in 2016, and I can’t afford to pay the penalty. How will this affect my taxes? A. If you were unable to get 2016 health insurance and are worried about paying the penalty for not having health insurance, I have some information that may ease your mind when you file your taxes. First, you may take comfort in knowing that there are more than 30 ways to qualify for an exemption from the penalty for not having health insurance, ranging from income related exemptions to hardships. About 40% of uninsured Americans may qualify for an exemption from the penalty for not having health insurance, so be sure to check out HealthCare.gov or the IRS free online tool to find out if you’re eligible for an exemption. In addition, you may get the exemption right through your tax return with TurboTax. If your income is below the IRS income filing threshold or you can’t afford a Marketplace plan, you do not have to apply for the exemption through the Marketplace. If you don’t qualify for an exemption, you may be eligible for tax credits on your 2016 taxes like the Child Tax Credit, the Earned Income Tax Credit, or the American Opportunity Tax Credit that may help offset the penalty for not having health insurance. The penalty for 2017 is 2.5% of your total household adjusted gross income, or $695 per adult ($347.50 per child), whichever is higher (with a maximum of $2,085 adjusted for inflation). For instance, a family of 4 making $70,000 would would pay $2,085. If they got a Bronze insurance plan, it would be about $4,600 a year in premiums, but they would qualify for about $2,650 in subsidy, which means their cost would be $1,950. That’s less than the penalty, plus the benefit of being insured. You still have time to enroll for health insurance for 2017. Open enrollment ends January 31, 2017. You still may be worried that health insurance is expensive, but when you purchase insurance in the Health Insurance Marketplace, you may be able to get help paying for your monthly premiums via a subsidy also known as the Advanced Premium Tax Credit. The credit is based on your household income and number of people in your family. In many cases, the credit enables you to have health insurance at a lower cost than paying the penalty, so don’t miss out on checking out healthcare.gov or your state Marketplace during open enrollment. And don’t worry about knowing the health care laws for taxes. TurboTax has you covered and will help you easily report your health care status when you file your taxes. Previous Post Tips on Finding New Physicians if Your Insurance Changed This… Next Post Health Insurance Marketplace Open Enrollment is Ending – Here’s What… Written by Lisa Greene-Lewis Lisa has over 20 years of experience in tax preparation. Her success is attributed to being able to interpret tax laws and help clients better understand them. She has held positions as a public auditor, controller, and operations manager. Lisa has appeared on the Steve Harvey Show, the Ellen Show, and major news broadcast to break down tax laws and help taxpayers understand what tax laws mean to them. For Lisa, getting timely and accurate information out to taxpayers to help them keep more of their money is paramount. More from Lisa Greene-Lewis Follow Lisa Greene-Lewis on Twitter. Leave a ReplyCancel reply Browse Related Articles Health Care No Health Insurance? Find Out if You’re Exempt F… Health Care Uninsured This Tax Season? See How You Can Save Money w… Health Care 6 Top Affordable Care Act Exemptions Health Care TurboTax 2016 Health Care Penalty Calculator Health Care I Don’t Have Health Insurance. Will I Face Any Penalt… Health Care Health Reform Law Has New Implications for Consumers an… Health Care I Don’t Have Health Insurance – What Tax Pe… Health Care Did You File a Tax Extension? You May Qualify for an Af… Health Care Not Insured? Find Out if You Qualify for an Exemption Health Care What is a Health Care Reform Tax Penalty [Calculator]?