Penalties for those without insurance coverage are set to rise next year
Those without health insurance in the United States could face higher penalties in 2015. Next year will be the first time that U.S. citizens will be required to report whether or not they have insurance coverage to the Internal Revenue Service. Those without insurance coverage will face fines, while those with coverage will avoid these fines. The uninsured could qualify for some 30 exemptions to these penalties, but most people are completely unaware of these exemptions.
3% of uninsured people are aware of the penalties they face in 2015
According to a recent survey from the Kaiser Family Foundation, only 3% of those without health insurance coverage know that they will face a fine in 2015. In 2014, the fine was set at a flat rate of $95 per uninsured person in a household, or 1% of a household’s annual income, whichever is greater. Those filing taxes in 2015 will be subject to this fine, if they lack insurance coverage. In 2015, the fine will increase, however, to a flat rate of $325 per uninsured person, or 2% of a household’s annual income. In 2016, this penalty will be increased again, with the average fine coming in at $1,100.
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Exchanges aim to make insurance coverage more available
All U.S. citizens are required to have health insurance coverage by the Affordable Care Act. The health care reform law was passed in 2010, but penalties have not been issued in order to provide consumers with enough time to acquire insurance coverage. Those without insurance can find coverage through state-based insurance exchanges, which provide affordable policies. These exchanges also provide consumers with access to subsidies from the federal government, which are meant to make insurance coverage more accessible.
26 million people may qualify for exemptions from tax penalties
According to H&R Block, some 26 million people could qualify for exemptions from penalties issued by the federal government. The problem, however, is that most people do not know about these exemptions or how to file for them. Consumers have until February 15, 2015, to purchase health insurance coverage and avoid penalties from the government.