The Affordable Care Act requires all Americans to have health insurance or pay a tax penalty. But, who qualifies for an Affordable Care Act exemption? Find out more about who qualifies for an exemption from the Affordable Care Act tax penalty.
The article below is accurate for your 2017 taxes, the one that you file this year by the April 2018 deadline, including a few retroactive changes due to the passing of tax reform. Some tax information below will change next year for your 2018 taxes, but won’t impact you this year. Learn more about tax reform here.
- Members of certain religious groups opposed to insurance
- Federally recognized Indian tribes
- Health care sharing ministries
- And those currently incarcerated are exempt
But you may also be exempt from the tax penalty if you’re experiencing financial or life hardships. For example, you may be exempt if:
- The lowest insurance premium available to you is more than 8% of your household income
- If you’re facing foreclosure
- Filing bankruptcy
- Your property was significantly damaged in a disaster (natural or human caused)
- Medical expenses
- Facing eviction
- Death in the family
- Or utilities shut off
You’re automatically exempt if you don’t have to file a federal income tax return because your income is too low. Depending on the reason, you may claim your exemption in one of two ways:
- Either apply for a certificate of exemption from the Marketplace
- Or simply claim the exemption on your tax return at the end of the year.
Most exemptions must be applied for through the Marketplace. But, if you’re applying based on coverage affordability, membership in a health care sharing ministry, federally-recognized Indian tribe, or incarceration, you may claim the exemption on your federal tax return.
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