Are you exempt from Obamacare's individual mandate?
The Patient Protection and Affordable Care Act, commonly referred to as Obamacare, generally requires individuals to maintain a minimum level of health insurance beginning January 1, 2014. Most of those who choose not to meet the law's requirements will have to pay a penalty.
But among the Affordable Care Act's many nuances are explicit exemptions for certain groups of people who do not have to abide by Obamacare's provisions. So who exactly is exempt from Obamacare's mandate?
9 Types of Obamacare Exemptions
As we explained earlier this week, Obamacare (the bill) spells out changes and additions to various parts of the United States Code. The most important changes are to Title 42 of the U.S. Code (Public Health and Welfare) and Title 26 (the Internal Revenue Code, aka the tax code).
Obamacare's exemptions are codified in Section 5000A of the tax code. There are nine explicit exemptions.
According to the law, the people who do not have to comply with Obamacare's mandate, and who will not face any penalty for noncompliance, are:
- Individuals who cannot afford coverage. For 2014, this means people who cannot afford health insurance because the premium (based on the lowest-cost Bronze plan, or the individual's share of an employer-sponsored plan) exceeds 8 percent of their household income. After 2014, the Secretary of Health and Human Services may revise the threshold.
- Individuals with household income below the filing threshold. This means anyone who doesn't have to file a federal income tax return.
- Members of federally recognized Indian tribes. The Federal Register maintains a list of federally recognized Indian tribes.
- Individuals who experience a hardship. According to HealthCare.gov, potential hardships may include being homeless, filing for bankruptcy, being a recent victim of domestic violence, or having been evicted in the past six months, among many others.
- Individuals who experience a short coverage gap. In general, this means a lapse in coverage of less than three months in a calendar year.
- Members of certain religious sects. Also sometimes called the "religious conscience" exemption, these religious sects must be recognized by the Social Security Administration as being "conscientiously opposed to accepting any insurance benefits," the IRS explains. As described in Section 1402 of the tax code, these sects must have been in existence since at least December 31, 1950.
- Members of a health care sharing ministry. Qualified nonprofit health care sharing ministries must meet the tax code's definition of such a group, and must have been in existence since at least December 31, 1999.
- Incarcerated individuals. This includes people in jail, prison, and other penal institutions.
- Individuals who are not lawfully present. This means anyone who is not a U.S. citizen or national.
Claiming Your Exemption
If you think you may qualify for one of these Obamacare exemptions, the method for claiming it varies, according to the IRS.
For example, to claim a hardship exemption, it must be granted by the Health Insurance Marketplace that covers your state. Other exemptions, such as for those who don't have to file a federal tax return, don't require any action at all.
Tomorrow in our "Understanding Obamacare" series, we'll explain how the new health care law affects Medicare.
-- FindLaw Blog Writer Betty Wang contributed to this post.
- What if someone doesn't have health coverage in 2014? (HealthCare.gov)
- Supreme Court Upholds Obamacare's Individual Mandate (FindLaw's Courtside)
- Obamacare for Small Businesses: A Basic Checklist (FindLaw's Free Enterprise)
- Obamacare Basics: Understanding the Affordable Care Act (FindLaw)