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Health Coverage Mandate

The Importance of Health Insurance

Health insurance provides regular, preventive care for you and your family to stay healthy and prevent illness. Medical bills are the number one cause of bankruptcy and can reach into the millions of dollars. Having quality health coverage gives you peace of mind knowing that if an accident or illness strikes you and your family are protected from a lifetime of financial burden.

Health Coverage Required until 2019

Starting with the 2019 coverage year (for which you will file taxes in 2020), there is no longer a tax penalty or “individual mandate” for not having health insurance.

However, the mandate is still in effect for the 2018 coverage year. This means most individuals, including their children and anyone else they claim as a dependent on their federal taxes must have had health coverage for 2018, qualify for an exemption, or pay a tax penalty when filing their federal tax return in 2019.

For 2016-2018, the penalty is the greater of:

  • 2.5 % of the amount of any taxable income that exceeds your tax filing threshold amount, or
  • $695 per adult and $347.50 per child (up to a maximum of $2,085).

A person will pay one-twelfth of the total annual penalty for each month without coverage.

The IRS website has resources to help calculate your penalty.

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