Will the ACA Affect Your Taxes This Year?

Will the ACA Affect Your Taxes This Year? Will the ACA Affect Your Taxes This Year?

Tax season is drawing near and as you ready your W2 forms, 1099s, receipts and other documents it is important to remember that there is an additional box you will have to check this year that when filling out your tax forms.  This year, in addition to declaring income, deductions, charitable donations and other financial data American taxpayers will be required to report their health insurance coverage in compliance with the Affordable Care Act (ACA). Depending on your healthcare overage and status, the ACA reporting can be either a benefit, a nuisance or simply benign.

The ACA states that individuals must maintain insurance coverage year-round. Individuals who did not, or do not, maintain sufficient healthcare coverage throughout the year must either qualify for an exemption or will be required to make what the government calls an “individual shared responsibility payment.” This “payment” is essentially just a non-compliance penalty fine for those who did not sign up for healthcare coverage through their employers or through the public healthcare trade. The fine for non-compliance in 2014 will be relatively low; however the fees will steadily increase in the years to come.

For individuals who participate in traditional healthcare coverage plans offered through their employers, there will likely be no major effect on your taxes this year as you will receive neither a credit nor a penalty as long as you have maintained sufficient coverage for yourself and your dependents. These taxpayers will simply be able to check a box on the newly retooled 1040 tax form, claiming they have what the government calls “minimal essential coverage. Individuals who have secured insurance for themselves and their dependents through government’s health insurance marketplace may be eligible for tax credits which can be directly applied to their insurance provide to offset the monthly premiums.

Navigating the new ACA requirements continues to be a challenge for many American citizens and businesses, especially this tax season. As such seeking professional assistance filing your tax return is always a good idea.

At Barnes Insurance Agency, we aspire to be a resource about the ACA and Tennessee Healthcare Reform for residents and businesses alike. We are here to help ensure that Tennessee has access to quality personal and business insurance solutions that will protect themselves, their families, and all their assets against a number of financial loss exposures. To learn more about our operation and our offerings, contact us today at (866) 733-5424.

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