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“Obama-care penalizes the poor!”

shutterstock_62287657-01-largeThis is the number one thing that I see posted on Facebook. There is a fear going around that people who can’t afford health insurance are going to face fines and penalties for being poor. If that is your fear, than rest assured, you will very likely qualify for an exemption!

Starting January 1st all Americans will be required to have a minimum of health care coverage for each month of the year. Unless you qualify for an exemption. One of the most common exemptions will be the exemption for Unaffordable Coverage. This says that if the amount that you have to pay for health care coverage is more than 8% of your household income, you can choose to file an exemption when you file your income taxes.

Let me break this down a little more. Let’s say that your household income is $3,000 per month. If the amount that you have to pay for health insurance for your family is over $240 (3,000 X 0.08 = 240) then you can choose to be exempt.

To me, this can be a good thing. Even healthy young people like my husband and I need health insurance. If it is less than 8% of our income, than we want it. If it is more, than we are not required to buy it.

To file for this exemption, you will need to file a special form when you do your 2014 taxes in the Spring of 2015.

There are some other exemptions that you might be able to file for. They are as follows:

Religious Conscience – If you are a part of a religious sect that is recognized to be conscientiously opposed to accepting government insurance benefits you can be exempt. You will have to file for this at the Health Insurance Marketplace.

Health Care Sharing Ministry – This is for you if you are a part of a health care sharing ministry.

Indian Tribes – You are exempt if you are a member of a federally recognized Native American tribe. You can file this exemption in the Health Insurance Marketplace or when you file your 2014 tax return.

No Filing Requirement – If your household income is below the threshold for filing taxes, then you are automatically exempt from having health insurance.

Short Coverage Gap – If you went without coverage for less than three consecutive months in a year, then you will not be fined for those months. If you had multiple short coverage gaps, then this exemption only works for the earliest one in a year.

Hardship – If you have suffered a hardship that makes it so that you are unable to obtain health insurance, you can file for an exemption at the Health Insurance Marketplace.

Incarceration – For the time that you are in jail, prison or similar institution after charges were filed against you, you are exempt from having health insurance.

Not Lawfully Present – If you are neither a US citizen, US national, or legally residing in the US, then you are exempt from having health insurance.

If you have any questions on whether or not you are exempt from having health insurance or how to file for your exemption, feel free to contact me at