What's the Affordable Care Act?

This new law makes health insurance...

Obamacare dates to know

Obamacare was passed in 2010. Here are other key dates:

  • March 31, 2014: Open enrollment for 2014 coverage closed (if you did not sign up for insurance by this date and aren't exempt, you may be subject to a penalty fee).
  • November 15, 2014: Open enrollment for 2015 health insurance coverage begins.
  • January 15, 2015: Open enrollment for 2015 coverage closes.

Insurance plans that count

You'll meet the new health insurance requirement if you are covered under a plan that you get through:

  • The new health insurance marketplace or a certified insurance broker
  • An employer, including COBRA and retiree coverage
  • Public health groups like Medicare, Medicaid, Children's Health Insurance Program (CHIP), or military or Veteran's Affairs, including TRICARE
  • A college or university that you're enrolled in
  • Peace Corps volunteer plans

Under Obamacare, these insurance plans must cover at least 10 essential medical services.

How the health insurance marketplace works

This new way to shop for insurance is also called an exchange and it's open to individuals, families and small businesses (). During open enrollment, you can...

You can also see if you qualify for free or low-cost coverage under Medicaid or the Children's Health Insurance Program at any time.

Insurance plans that don't count

The following types of plans do not meet Obamacare requirements for qualified health plans:

  • Worker's compensation plans
  • Insurance for a specific disease or condition, such as cancer insurance
  • Plans that only cover dental or vision care
  • Plans that only offer only discounts on medical services
  • Insurance for long-term care

Who doesn't have to have insurance in 2014

Under Obamacare, you must have insurance or pay a penalty fee unless you are:

  • A member of certain religious sects or ministries, or of a federally recognized Native American tribe
  • Uninsured for less than three consecutive months in a year
  • Not able to get insurance because the lowest premium amount is more than eight percent of your household income or due to hardship
  • In jail, prison, or correctional facility
  • Not a U.S. citizen, U.S. national or alien legally present in the U.S.
  • Uninsured because your insurance plan was recently cancelled and you can't afford a marketplace plan.

You may be exempt if you had a hardship

If you had a circumstance that affected your ability to get health insurance coverage, you may qualify for a “hardship” exemption. Under the law, this includes if you...

  • had medical expenses you couldn't pay in the last 24 months.
  • had unexpected increases in necessary expenses due to caring for an ill, disabled, or aging family member.
  • were evicted in the past 6 months or were facing eviction or foreclosure.
  • filed for bankruptcy in the last 6 months.
  • received a shut-off notice from a utility company.
  • were homeless.
  • recently experienced domestic violence.
  • recently had a close family member pass away.
  • had substantial damage to your property from a fire, flood, or other natural human-caused disaster.
  • had any other hardship getting health insurance.

No penalty if your income is too low

If you don't need to file a 2014 tax return because your income is less than the minimum, you won't have to pay the penalty fee for not having health insurance. The requirement to file a federal tax return depends on your filing status, age and income. To find out if you have to file a federal tax return, use the IRS Interactive Tax Assistant tool.

Also, if the lowest-price plan in your area costs more than eight percent of your household income, you won't owe a penalty fee.

Employers don't have to insure workers in 2014

Under Obamacare, employers are not required to offer health insurance to their employees in 2014 or 2015. Starting in 2016, employers with more than 50 full-time workers will be responsible for offering affordable health insurance to their employees. If they don't, they may face fines. Businesses with fewer than 50 employees won't be required to offer coverage, but certain employers with fewer than 25 full-time workers that do, may be eligible for tax credits.

What happens if you don't have insurance in 2014

In 2014, you must be enrolled in a health insurance plan, one way or another by March 31, 2014, or pay a penalty fee on your 2014 tax return. Some exceptions apply, but won't to most people.

Penalties won't apply to your 2013 return, which you file in 2014. Although the penalties don't apply to 2013 returns, insurance coverage must be purchased by March 31, 2014.

What you'll pay for not having insurance

For tax year 2014, the penalty for not having health insurance is the larger of 1% of your 2014 income or $95 per uninsured adult (plus $47.50 for each uninsured child up to a maximum of $285 for a family of 3 or more). In tax years 2015 and 2016, the penalty increases quite a bit. Also, if you don't have health insurance, you'll be responsible for paying 100% of your medical bills, which can cost far more than the penalties for not having coverage. The amount you owe will be pro-rated to the number of months you didn't have insurance.