Special Enrollment Period for the Uninsured During Tax Season

Most Americans must have health insurance. It’s the law.

But as the 2014 tax filing season gets underway, you may be caught off guard by an extra tax of $95 or more due with your 2014 tax return. 

That’s because if you went for three consecutive months or more during 2014 without health insurance, you will be hit with a penalty tax (unless you are exempt).

Here is the amount of the penalty, which will increase for 2015 and 2016:

2014	2015	2016
$95 per adult $47.50 per child Family Maximum of $285 OR 1% household income, whichever is GREATER	$325 per adult $162.50 per child Family Maximum of $975 OR 2% household income, whichever is GREATER	$695 per adult $347.50 per child Family Maximum of $2,085 OR 2.5% of household income, whichever is GREATER

If you were penalized for not having coverage in 2014, and still have not purchased coverage for 2015, the government is giving you a second chance to buy 2015 coverage and avoid another — even higher — penalty.

Virginia residents can visit www.enrollvirginianow.com to enroll in less than 15 minutes!

Second Chance to Enroll — Special Enrollment Period March 15 – April 30, 2015

Although open enrollment for 2015 ended on February 15, 2015, you can enroll in coverage between March 15 and April 30, 2015 if all of the following are true:

• You live in a state (including Virginia) that uses the federal marketplace (healthcare.gov); and

• You are NOT enrolled in health insurance for 2015; and

• You attest that when you filed your 2014 tax return you paid the fee for not being covered in 2014; and

• You attest that you first learned about or understood the implications of the penalty tax after open enrollment ended on February 15, 2015, as a result of preparing your 2014 tax return.

In other words, you must state that you did not understand the law enough to realize you’d be penalized for not being covered in 2014, AND that you only found out by virtue of completing your 2014 tax return, by which time it was too late to buy coverage for 2015 during regular open enrollment, which ended on February 15, 2015.

By taking advantage of the special enrollment period, you can get 2015 coverage, effective on the following dates:

• Enroll between March 15 – April 14 — Coverage effective May 1
• Enroll between April 15 – April 30 — Coverage effective June 1

Virginia Medical Plans Can Help

If this situation applies to you, visit www.enrollvirginianow.com to see available plans.

If you need help understanding your options and selecting the best plan for you, give us a call at 703-707-8270.

Being covered in 2015 will save you from some of the penalty.  AND our services are completely free!  You pay no more for your coverage when you purchase it through us, but you get the benefit of our guidance and help.

We are happy to help. Call our office at 703-707-8270.

Three Reasons Why You Should Enroll in Health Insurance Now

Under the Affordable Care Act (ACA), open enrollment for 2014 health insurance runs through March 31, 2014.

We are well into February.  If you have not yet enrolled in coverage, you may need some convincing as to why you should not wait until the last minute.

Here are three compelling reasons to enroll in health insurance before March 31:

1. Avoid the Rush
   If you think back to the days leading up to the end of 2013 when everyone who wanted their coverage to begin on January 1 was trying to get enrolled, then you understand the mess that can result from everyone flooding the system with applications at the same time.  Insurance companies struggled to keep up with enrollments and some people even today have not gotten confirmation of coverage.  Enrolling now will help avoid that rush.
2. Get Covered as Soon as Possible
   The date you enroll in coverage determines the effective date of that coverage (see chart below).  If you enroll on or before the 15th of the month, your coverage is effective the first day of the next month.  Enrolling between the 16th and the last day of the month means you will wait until the first day of the month after next for your coverage to kick in.  Why take the chance of getting sick before you’re covered?
3. Enroll Before February 15, 2014 to Avoid Filing an Exemption
   ACA dictates that a penalty tax is assessed if you go for three consecutive months without coverage. Therefore, if you don’t yet have insurance, you have a grace period — until March 31, 2014 — before you will be assessed a penalty.  But, here is where it gets a little complicated. The date you enroll is not the same as the date the coverage is actually effective:

   If you apply between …	Your coverage will be effective …
   January 16, 2014 – February 15, 2014	March 1, 2014
   February 16, 2014 – March 15, 2014	April 1, 2014
   March 16, 2014 – March 31, 2014	May 1, 2014

   Enrolling after February 15, 2014 means your coverage will be effective — at the earliest — April 1.  If you are not actually covered by March 31, 2014 you will need to file a hardship exemption on your 2014 income tax return to avoid being assessed the penalty tax.

As the image above states, Go on, DO IT NOW!   Give us a call today so you can get enrolled in coverage right away.  You can also click on the buttons in the upper right hand column to get instant quotes.   Virginia residents, if you think you may be eligible for a subsidy, click here for more information.   Maryland and DC residents click here.

Reach us by phone 1-800-867-0800 or email jkatz@vamedicalplans.com, but don’t delay!

How Much Penalty Will I Pay if I Don’t Get Health Insurance?

The individual responsibility clause of the Affordable Care Act (ACA), also known as the individual mandate, requires all Americans to have health insurance by January 1, 2014, or pay a penalty tax.

How Much Will the Penalty Be for not Having Health Insurance?

You may have heard the figure $95 per person.  That is the basic penalty in 2014 for an unmarried individual, earning less than $19,500/year, with no dependents.

If you don’t fit that category, the penalty — which is actually not a penalty, but a tax — is a bit more complicated.

How the Penalty Works

YEAR	PENALTY WILL BE THE GREATER OF:
2014	$95 per adult plus half that amount per child under 18, based on the number of uninsured people in your household, capped at 3x adult rate = $285; or 1% of your adjusted gross income (capped at the cost of a bronze plan available through the exchange).
2015	$325 per adult plus half that amount per child under 18, based on the number of uninsured people in your household, capped at 3x adult rate = $975; or  2% of your adjusted gross income (capped at the cost of a bronze plan available through the exchange).
2016	$695 per adult plus half that amount per child under 18, based on the number of uninsured people in your household, capped at 3x adult rate = $2085; or  2.5% of your adjusted gross income (capped at the cost of a bronze plan available through the exchange).
2017 and beyond	Penalty will be increased annually by cost of living

Notice that wealthier households will pay a percent of income rather than a flat amount.  For example: in 2016, an individual earning below $37,000 would pay $695 (flat-dollar calculation) while an individual earning $200,000 would pay $5,000 (2.5% of income).

The reason we say the penalty is actually a tax is that it will be assessed on your income tax return.  This means it will be added to any amount of tax you owe, and deducted from any refund amount you are due.

Calculate Your Penalty Amount

We found a quick and easy calculator you can use to check the 2014 penalty.  Check it out.

Purchase Health Insurance for all Family Members

Before you think about just paying the penalty, keep in mind that having health insurance is about more than paying a premium.  It is about safeguarding yourself and your family from what can happen without access to medical care.

Exceptions

The simplest way to avoid paying the penalty tax is to purchase health insurance for yourself and other members of your household!

There are a few other exceptions:

• You are part of a religion opposed to acceptance of benefits from a health insurance policy.
• You are an undocumented immigrant.
• You are incarcerated.
• You are a member of certain Native American tribes.
• Your family income is below the threshold requiring you to file a tax return ($9,350 for an individual in 2010; $18,700 for a family in 2010).
• You have to pay more than 8% of your income for health insurance, after taking into account any employer contributions or tax credits.
• You have a gap in coverage for less than a continuous three-month period (this exemption may only be used for one period without coverage in a year).

Virginia Medical Plans can help you avoid the penalty and get health insurance for yourself and/or your family.

Call our office so that we can find the right coverage at the right price for you!

Please be patient as we manage a high volume of calls and emails.