Tuesday, October 20, 2015

Beware of the Obamacare Shared Responsibility Payment

"You have an unpaid shared responsibility payment for 2014. 
 Amount due: $2,344.00"

The above notice from the IRS was received by this family for their shared responsibility payment for 2014, which was 1% of their income.  A $2,344 penalty for not having insurance coverage in 2014 is bad enough, but the sobering reality is that if this couple remains uninsured in 2015 the penalty will increase to 2% of their income, and if they stay uninsured in 2016 the penalty will increase to 2.5% of their income.

How is the actual shared responsibility payment computed?  

True, it's your choice whether or not to have health care coverage.  Instead of being surprised at tax preparation time, it's important that the decisions we make about health care coverage ahead of time are made with the full understanding that the shared responsibility payment could be considerable, and will increase each year.

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