A health reform change tops the list: Individuals without insurance owe a tax. Although President Obama’s administration delayed the requirement that employers with 50 or more employees with affordable health care coverage or pay a stiff fine, the 2014 starting date for the individual mandate wasn’t deferred.
Folks must have qualifying coverage for themselves and their dependents to avoid the tax. This includes, for example, health care coverage provided by an employer that meets minimum federal requirements, coverage purchased through an exchange and federal coverage such as Medicare, Medicaid, Tricare and veterans coverage.
Individuals for which the coverage is too expensive are exempt from the tax. Employees who share of premiums exceeds 8% of the household AGI won’t be hit. Ditto for people ineligible for employer coverage if the cost of basic bronze-level plan in an exchange, less any tax credit for buying insurance, exceeds 8% of household AGI.
Also exempt: Filers without coverage for periods of less than three months. And people who can show that hardship forced them to go without coverage, including folks whose insurance was canceled and who can’t buy affordable policy.