Question

How can I avoid paying a penalty for Obamacare health insurance? My income qualified during the time I had coverage, then I cancelled the plan when I got a new job.

Forum|Forum|7 years ago
June 5, 2019
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Employee

If you qualified for the income-related exception prior to the new job and had coverage from your new employer, you do not have to pay a penalty. But, while you mention "Obamacare" it is not clear whether you did or did not have state or federal marketplace coverage at any time during the year. If you did, you would have received a 1095-A form listing insurance subsidies paid on your behalf. Those subsidies were based on a yearly income you estimated and if your estimate was too low, some of the subsidy is paid back at tax time. That is not a penalty, just a reconciliation of what the Premium Tax Credit amount worked out to be and what was prepaid to you in advance.

On the other hand, if you didn't have marketplace coverage, just go back into TurboTax, click on the Health Insurance tab, and follow the instructions. The third screen you come to has a checkbox on affordability.

A

aloi68

hbl3973 -- I had a Covered California plan from Jan. through Sept. 2018 (with qualifying income level). I started a new job with company-sponsored health insurance that began on Oct. 1. When doing my tax return, there is no way to separate the period early in the year when I qualified for Covered CA from the last quarter when my income was significantly higher. I am being told I have to pay more than $3k to reimburse Covered CA because my income disqualified me for the subsidies. I need to know how to separate the first 9 months from the last 3 months of the year.