When tax time rolls around, most people are concerned with the amount of their taxable income and the deductions they can take to get the largest refund possible. However, as a recent article in the Albuquerque Journal reminds us, some people in Houston and throughout the U.S. may owe more in taxes than they thought. Due to the Patient Protection and Affordable Care Act, beginning in 2014 all non-exempt U.S. citizens and legal permanent residents are required to maintain a minimum amount of health care coverage. Failure to carry the minimum amount of health insurance in 2014 may result in a penalty being paid when you file your taxes, which should be done by April 15, 2015, unless you obtain an extension. (Remember that even if you file for an extension, it is not an extension of time to pay any tax due, which means you’ll need to estimate your tax liability and send the payment to the IRS by April 15.)
According to healthcare.gov, people who don’t have coverage in 2014 will pay the higher of:
While there are exemptions from the rule, people will need to determine if they are eligible, and presumably many tax preparation software packages should provide you with guidance and if you will owe a penalty as well as the amount of any such penalty. If you have an accountant, he or she should be able to guide you the process as well.
See Albuquerque Journal (December 28, 2014) “Tips help prep for improved finances”