Beginning in the 2014 tax year, the Affordable Care Act legislates an annual penalty for not being insured (see the following article on the penalty).
The Affordable Care Act has provisions for exemptions from the Uninsured Tax Penalty. In order to qualify for the exemption, you must fulfill at least one of the following criteria:
There are also hardship exemptions. These include:
How you apply for the exemption under the Affordable Care Act depends on which exemption it is based on.
If you are applying for an exemption based on coverage being unaffordable, membership in a health care sharing ministry, you are a member of a federally-recognized tribe or being incarcerated, you have two options: 1) You can claim these exemptions when you fill out your 2014 federal tax return, which is due the following April or 2) you can apply for the exemptions in the Health Insurance Marketplace.
If your exemption is based on membership in a recognized religious sect that objects to insurance, eligibility for services through an Indian health care provider or one of the hardship exemptions, you will need to fill out an exemption application in the Marketplace.
You do not need to file for an exemption if your income is below the federally required minimum to file a tax return. This is true even if you file a return to receive a refund of the taxes that were withheld from your paycheck. In addition, you do not have to file for an exemption if you have a gap in coverage that is less than 3 months or are unlawfully present in the United States. These will be addressed when you file your tax return.
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