Confused by the tax filing requirements under the Affordable Care Act (ACA)? You are not alone. Filers for 2014 must report healthcare coverage on form 1040 in the taxes section on page 2.

Failure to meet the requirements can subject you to a penalty. Most Massachusetts residents will be adequately covered by the requirements of the mandatory healthcare law in the state. There are several provisions to consider and discuss with your tax advisor: filing compliance, minimum essential coverage, Shared Responsibility Payments, income adjustments for Premium Tax Credits, or validating an exemption.


Reporting Minimum Essential Coverage

When you file your taxes, you must report minimum essential coverage. New forms (1095-A, 1095-B, 1095-C) are being issued at year end, similar to 1099s and W-2s, and will provide information about healthcare coverage that you had in 2014. Some employers may not issue these forms (as they are not required) until 2016. These forms help determine what months you had coverage, and how much assistance you received.

In the event you had multiple insurance sources during the 2014 year, you may receive more than one form. By completing the minimum essential coverage section of your Federal income tax return, you will determine if you owe money for months without coverage.


Shared Responsibility Payment

In the event you did not acquire and retain minimum essential coverage for a period longer than 3 consecutive months, you may be required to make a Shared Responsibility Payment. This payment is based on each month you, or a household member, went without coverage (unless an exemption applies).

For 2014, the annual fee is $95.00 per adult, $47.50 per child, with a maximum of $285.00 per family, or, 1% of your household income above the tax return filing threshold for your filing status, whichever is greater.


ObamaCare Exemption

obamacare exemptionWho qualifies for an exemption? How you get a coverage exemption depends upon the type of exemption for which you are eligible. You can obtain some exemptions only from the Marketplace while others may be claimed when you file your tax return. Some exemptions can be obtained from the Marketplace or claimed on your tax return. You will report an exemption obtained from the Marketplace when you file your tax return. For those who have been granted an exemption, the Marketplace will have provided you with a unique Exemption Certificate Number (ECN). You need to ensure this ECN is provided on your 2014 Federal income tax return.


Low Income Exemption

In the event your income is too low to file a tax return, you are automatically exempt from the tax filing requirements under the Affordable Care Act (ACA). For more information on this exemption, please contact the professionals at Dukhon Tax, or review the details on the website.


Reporting for the new Healthcare Law, The Bottom Line

The Federal income tax return has changed. When in doubt about filing requirements for 2014, please refer to and Qualified local accountants and tax practitioners can also provide up-to-the-minute information and financial guidance. If you are a Massachusetts (or New England) resident, the advisors at Dukhon Tax, a Boston-based tax practice, welcome the opportunity to assist with your tax-planning, compliance, and preparation. Contact us today »