Marketplace Open Enrollment for 2017 health insurance is just around the corner, and whether you sign up for health insurance on healthcare.gov or through your state Marketplace, your local Dallas CPA is here to help guide you through the process. Whether you have had a change in life circumstance, are self-employed and need access to health insurance, or just shopping for an affordable plan, read on for information and tools that can help you enroll in a 2017 health insurance plan that makes sense for you, your family, and your budget.
Open Enrollment Dates
For 2017 health insurance coverage, Open Enrollment runs from November 1, 2016 to January 31, 2017. If you want your coverage to take effect on January 1, 2017, make sure to select your plan by December 15, 2016.
Helpful Tools for Open Enrollment
Selecting an insurance plan is an important financial decision. There are many free tools and calculators to arm you with all the information you need to choose the level of health care coverage that makes the most financial sense for you and your family.
The IRS has a free online tool that lets you know if you may qualify for a subsidy, or premium tax credit (assistance from the government), for 2017 and estimates how much you may receive to help pay your monthly health insurance premiums. Make sure to calculate your expected household income for the next year carefully, which is needed to figure how much assistance you may be eligible for to help pay for health insurance. Some consumers end up paying some money back on their tax returns if they underestimated their projected income. The more closely you calculate your household income, the easier it is to avoid any surprises come tax season. And if you received an advanced premium tax credit to help you pay for 2016 health insurance, your CPA will figure out if you are eligible for a bigger premium tax credit or have to pay some back when you file your taxes. No need to worry.
Penalty for Going without Coverage to Increase — Exemptions Can Help
Based on last year, it is expect that nearly 40% of uninsured tax filers will qualify for a penalty exemption on their tax returns for 2016, so it’s definitely worth checking into. Check out the IRS free online tool to determine if you’re eligible for an exemption.
If you don’t qualify for an exemption, the penalty is 2.5% of your total household adjusted gross income, or $695 per adult ($347.50 per child), whichever is higher (with a maximum of $2,085). For 2017 and beyond, the percentage option will remain at 2.5%, but the flat fee will include a cost-of-living adjustment.
Shopping around during this Open Enrollment will allow you to look for an affordable plan and could help you avoid paying a tax penalty when you file your 2017 taxes.
Reporting Coverage on Taxes
This is the third year taxpayers must report their health insurance status on tax returns, but there’s no reason to worry – this tax year will be just as simple as last year.
If you purchased a health insurance plan on healthcare.gov (CuidadodeSalud.gov for Spanish speakers) or your state Marketplace, you will receive Form 1095-A, which confirms coverage, premiums and any subsidies you received to help pay for health insurance.
People who were insured through their employer, a government program such as Medicaid, or other private insurance, will most likely receive a new tax form (1095-B or -C) confirming coverage or offer of coverage. If you receive these forms, simply review the forms for accuracy and keep the 1095-B or -C for your records – that’s it. You don’t need to wait for these forms to file your 2016 taxes.
Your local Dallas CPA is always up to date with the latest tax laws, and will continue to keep you informed so you have the latest information on how the ACA might affect you and your taxes. If you have more questions about the Affordable Care Act and your taxes, call your CPA today!