4 new exemptions to the tax penalty for lacking health insurance
There already have been more than a dozen reasons U.S. consumers can use to avoid paying the penalty for not having health insurance. Now the federal government has added four more. These “hardship exemptions” let people off the hook if they can’t find a marketplace plan that meets not only their coverage needs but also reflects their view if they are opposed to abortion. It’s unclear how significant the impact will be, policy analysts say. That’s because starting in tax year 2019 the penalty for not having health insurance will be eliminated, so the new exemptions will mostly apply to penalty payments for 2018 taxes and in the previous two years. Under the new rules, people can apply for a hardship exemption that excuses them from having to have health insurance if they:
- Live in an area where there are no marketplace plans.
- Live in an area where there is just one insurer selling marketplace plans.
- Can’t find an affordable marketplace plan that doesn’t cover abortion.
- Experience “personal circumstances” that make it difficult for them to buy a marketplace plan, including not being able to find a plan in their area that gives them access to specialty care they need.
The first new exemption isn’t relevant for consumers in 2018. Since the Affordable Care Act’s marketplaces opened, there have been no “bare” counties that lack insurers.