If a single person with high income, say $100,000 needs to make a payment, would it be $95. or the 1% of a figure? What figure? Confusing. I would understand that a family would pay a maximum of $285.00, no more, regardless of income?
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The penalty is the GREATER of $95, or 1% of income that exceeds the filing threshold amount for the year. Thus, if the taxpayer has $100,000 of income and the filing threshold for a single taxpayer under age 65 is $10,150, the penalty equals $899 (1% of $100,000 minus $10,150).
The maximum penalty is further limited by the national average annual premium for bronze level health plans offered through state health insurance exchanges. Rev. Proc. 2014-46 says that amount is $204 per individual per month for 2014, or $2,448 for the year. If the household size has five or more members, the maximum national average bronze plan premium is $1,020 per month. Thus, if someone made millions of dollars over the filing status threshold, the most the penalty would be for not having insurance is capped at the national average premium for bronze plan amounts.
You need TTB Health Care book. It explains all of this and has instructions for all of the new tax forms we need to file this year for the health care stuff. -
EDIT: Sorry, Bees Knees posted while I was typing. Most of this is a repeat of that.
Nope, $285 is the maximum flat penalty, but the actual penalty is the greater of the flat penalty or the 1% penalty.
The 1% penalty is 1% of the "household income" that is over the filing threshold ($10,150 for a Single person, $20,300 for Married Filing Jointly). So a Single person in 2014 with $100,000 of "household income" would be 1% of $89,850, or $898.50.
"Household income" includes the income of any dependents that are over their filing threshold and are required to file (including Kiddie Tax).
The overall MAXIMUM penalty for 2014 is $2,248 ($204 per month) per person (see Line 13 of the Shared Responsibility Payment Worksheet on page 5 of the 9865 Instructions).
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Health Care Book/ Bees Knees
Do you mean the Health Care and Retirement book that will be out 12/15/2014. How do you know what is in it?Comment
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Will software do the Calculation?
Can I assume that the software will do the calculation with correct imput?Comment
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Why did they use the term "members of the household" instead of "all claimed on tax return"? Or do the mean All living in the taxpayers home? There are situtions where there are more than one family is in the home ( not a 2 family house). Which is it, tax return or in the house?Last edited by BOB W; 11-18-2014, 09:27 PM.This post is for discussion purposes only and should be verified with other sources before actual use.
Many times I post additional info on the post, Click on "message board" for updated content.Comment
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I would assume so.
However, there is a very good chance that the software will NOT help you figure out if they qualify for one of the "not affordable" (8%) exceptions (there are two different ones).
It's tax return. They just like to speak legal gobbledygook. :-)
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It was in last year's Health Care Reform book, page 2-2. Rev. Proc. 2014-46 which explains the maximum national average bronze plan premium came out in 2014, and TMI says they will update the Health Care info for all the new stuff that came out in 2014, including line by line explanations of all the new health care tax forms for 2014.Comment
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OK...So it means all persons claimed on a the family tax return. Why do I keep seeing "Age 18" or less?This post is for discussion purposes only and should be verified with other sources before actual use.
Many times I post additional info on the post, Click on "message board" for updated content.Comment
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The penalty is the greater of the "flat" penalty and the "percentage" penalty. For the "flat" penalty, it is $95 per person (in 2014), but only 50% of that amount ($47.50 in 2014) for people age 18 or less.
As a side note, the "flat" penalty is 'maxed out' at 3 times the adult amount ($295 for 2014). So the "flat" penalty for two adults with 9 kids would still be $295 (for 2014). However, the "percentage" penalty could be greater than that.Comment
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