Feds Push to Inform Public About ObamaCare Tax Breaks
Source: The Hill
The federal government is taking extra steps to help the millions of people who qualify for ObamaCare tax breaks this year but may not know it.
The Treasury Department released fact sheets Friday about five of the most common types of exemptions related to a person’s income level, job status, Medicaid eligibility and other scenarios.
For example, people who have incomes below a certain threshold are exempt because the coverage would be considered “unaffordable.” People can also seek a “hardship” exemption if they had costly medical expenses, were victims of domestic violence or lost a family member.
People who leave their jobs temporarily can qualify for a “short gap” exemption. People with low incomes are also exempt if they are living in one of 21 states that have not expanded Medicaid under ObamaCare, such as Texas or Florida.
Uninsured people are due to pay $95 per adult or 1 percent of family income this tax season, whichever is higher.
The federal government has struggled to navigate this year’s tax season, which is the first time that people will have to pay the penalty for lacking insurance. As many as 6 million people could face the penalty, officials said earlier this year.
Nationwide, knowledge of many ObamaCare rules is limited. About half of uninsured people are unaware about the penalty for lacking insurance, according to a recent poll by the Urban Institute.
Intuit, the company that sells TurboTax, has estimated that at least 20 million people who lacked insurance last year could qualify for an exemption.
“More than 19 out of 20 people who could have the penalty have not applied for an exemption, which means many people may pay more in taxes than they should,” the company said in January.
With more than 30 possible exemptions, the process can be complicated. People seeking hardship exemptions, for example, must apply through the marketplace rather than applying on their tax returns.
This year’s tax season is also the first in which ObamaCare customers will have to claim their subsidies. Officials have estimated that about half of people who received subsidies in advance will end up paying some back because of changes to their income or family status.
Filed Under: ACA/Health Reform