Tax season is right around the corner and healthcare is something that is not always on top of your priorities–but it should be. This year you could claim a tax credit or get fined if you don’t have health insurance. To qualify for a tax credit you have to purchase insurance coverage through marketplace or Obama Care. The Affordable Care Act Premium Tax Credit is a new refundable tax credit that can lower your monthly health insurance premiums.
If you make less than 400% federal poverty level and you qualify for these tax credits. According to Obama Care Facts, 1 in 6 Americans can get health insurance through Market Place for $100 or less. Tax credits can be paid in advance to lower your premium or you can deduct it when you do your taxes.
How much is the credit? It depends on how much you earn the number of people in your household. The last day to get covered is February 15th, so apply now if you have no health insurance. The older you are the larger the credit because your insurance premiums are higher.
Penalties due on Tax Day
If you don’t have insurance through your employer and choose not to get insurance through marketplace, then you will have to pay a penalty equal to 1% of your 2014 income or $95 per person, whichever is higher. If you have children under the age of 18, the penalty per child is $47.50, up to $285 for the entire family. Visit healthcare.gov for more information.