How Much is ObamaCare Penalty?
A lot of Americans were not really happy upon knowing that the ObamaCare now requires them to purchase health care plans. Many fail to see the importance of a health care plan in their life and this is what ObamaCare emphasizes. So, since the ObamaCare Tax Penalty is now inevitable, a ray of light can still be seen in this case. The ObamaCare Tax Penalty for people who do not want to purchase health care plans is lesser than an actual health insurance. But how much is the ObamaCare Tax Penalty?
There is no fixed amount for everyone else to pay if they opt not to purchase any health care plan. The amount will be dependent on some factors. Here are several key points that you should know about the penalty for not having insurance.
- In 2014, the minimum tax or penalty per person will fall at $95 and then it will gradually increase through to 2016.
- In 2016, the minimum tax or penalty per person will be at $695 and it can be up to three times of that per household or family. After the year 2016, these amounts will increase depending on the inflation rate.
- Regardless of the number of people in the family, payment will not go over 3x of the per person tax penalty.
- The penalty of $695 per person will only apply to those who earn between $9500 up to $37000 per annum. If you are making less than the minimum, you will be exempted. If you are earning more than the max range, the penalty will be calculated based on a formula.
The formula will be 2.5% of the household income that fall above the level in which you will be required to file for an ITR or Income Tax Return. So, if you are earning more, the penalty from your taxable income will also be more. On the lighter note, the ObamaCare Tax Penalty cannot go beyond the Bronze Health Plan.
Here is a list of the possible ObamaCare Tax Penalty depending on the income level per annum:
- $9499 or less income equals $0 tax penalty
- $9500 up to $37000 income equals $695 tax penalty
- $50000 income equals $1000 tax penalty
- $75000 income equals $1600 tax penalty
- $100000 income equals $2250 tax penalty
- $125000 income equals $2900 tax penalty
- $150000 income equals $3500 tax penalty
- $175000 income equals $4100 tax penalty
- $200000 income equals $4700 tax penalty
- $200001 income or more equals the same amount or cost of the Bronze Health Plan as tax penalty
The tax penalty will then be collected by the IRS. There will be exemptions to the ObamaCare Tax Penalty though, and these exemptions include:
- Those who are making $9499 and lesser
- Those employees who have employers offering plans that amount to 8% or more of the employees’ salary
- Those who are currently experiencing “hardships”
- Those who belong to Indian tribes
- Those who are members or certain religions that are not paying any Social Security Tax like the Hutterites, Mennonites, or the Amish.
If you are unsure of how much your ObamaCare Tax Penalty is, you will need to check your income per annum and do the math from there. On the other hand, you can also consult an accountant about it.
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