Taxes are not something I would normally choose to talk here but there are changes happening this year with the Affordable Care Act (ACA), or Obamacare, that will affect your taxes and are too important to just ignore. I’ve always trusted TurboTax to do my taxes — my dad used TurboTax before me and I’ve been using it for almost 15 years now since I started filing my own taxes in college — and I have confidence knowing that TurboTax will help me file with ease, without errors, and in a way to maximize my returns too!
TurboTax has been simplifying the federal tax code for the past 30 years and has done the same with the ACA. With software like TurboTax, you’re never exposed to the ACA forms – TurboTax has already done the work for you and will ask you the questions you need to answer so you can be confident your taxes are done right.
Taxpayers will fall into three categories when it comes to ACA and taxes: those insured through an employer, those insured through health care exchanges, and those who are uninsured. Here’s what you need to know:
- The Insured:
- For most people (9 out of 10 taxpayers), complying with the ACA on taxes is a non-event because they have insurance through their employer, Medicaid, Medicare, or a private provider (Congressional Budget Office). They will just check a box on their tax return to confirm they have health insurance. There’s no need to spend more on tax preparation.
- Insured through Exchanges:
- This year 8 million people became insured through healthcare.gov or their state exchange (Congressional Budget Office).
- Those who purchased insurance through the exchanges will receive a 1095-A form from healthcare.gov or their state exchange. They will enter information from their 1095-A on their taxes, just like they do with their W-2 forms.
- The Uninsured:
- Roughly 42 million people are uninsured in America (Congressional Budget Office).
- Those who do not have insurance and don’t qualify for exemptions will pay a penalty of about $95 or about 1% of their income.
- If you’re currently uninsured, think about buying insurance this year during open enrollment.
- TurboTax has a free calculator to estimate how much your penalty may be for 2014. The health care penalty is based on your family size and income. You can find the free calculator at TurboTax Health.
There are also a number of exemptions available and while about half of those uninsured qualify, only 5% of those people have applied! There are a number of reasons why someone may be exempt from the penalty for not having health insurance, like not meeting the minimum income requirement. TurboTax Health offers free tools to help you understand if you might qualify for an exemption.
You’ll also want to keep a few dates in mind for next year. To enroll for insurance through the Marketplace for 2015, Americans must sign up during open enrollment period, November 15, 2014 through February 15, 2015.
- Americans who can’t afford health care through an employer or out of pocket, can enroll for insurance through the Marketplace and may even qualify for government assistance though premium tax credits and subsidies.
- Eligibility is generally determined by household income and family size. People can see if they’re eligible for a subsidy by checking out TurboTax’s health care calculator at TurboTax Health.
Hopefully this sheds some light on how the Affordable Care Act will affect you and your taxes as well as how TurboTax can make it all straight-forward and easy to understand. Now back to holiday shopping! 🙂
Disclosure: I was selected for this opportunity as a member of Clever Girls and the content and opinions expressed here are all my own.
P.S. In case you missed it:
- Burberry Look-For-Less :: Checked Blanket Poncho – Ponchos are for petites too! Especially when it comes in this pretty color-block checked print!