New IRS Publication Helps You Understand the Affordable Care Act
Whether you are in favor or opposed to the new federal health care law (the “Affordable Care Act“), you can no longer afford to ignore it. If you feel the like the law is too complicated to understand, you are in luck!
The IRS has just released a publication created to help you learn about how the Affordable Care Act affects your taxes. The publication is titled, IRS Publication 5187, Health Care Law: What’s New for Individuals and Families. You can also visit the new Affordable Care Act Tax Provisions homepage on IRS.gov to learn more about the Affordable Care Act tax provisions.
This article briefly explains some of the key components of Publication 5187 and outlines the general framework of the Affordable Care Act tax penalty. The tax lawyer at the Columbus, Ohio based law firm Porter Law Office, LLC is an experienced tax litigator who can help you understand your tax obligations under the Affordable Care Act.
What is the Affordable Care Act?
The Affordable Care Act addresses health insurance coverage and financial assistance options for individuals and families, including the premium tax credit. It also includes the individual shared responsibility provision and health coverage exemptions from that provision.The IRS administers the tax provisions included in the law. For more detailed information about how the Affordable Care Act affects you and your taxes, you should review two charts on IRS.gov: ACA and You Chart, and ACA and Your Tax Return Chart.
While the health care law has several parts, Publication 5187 breaks down what’s new for the 2014 federal tax return you will be filing in 2015. The new Publication 5187 provides important information about how the Affordable Care Act affects you and your business. It provides information that you need understand for taxpayers who:
- Had health insurance coverage for the entire year
- Did not have health coverage for each month of the year
- Purchased health insurance from the Marketplace
- Might be eligible for an exemption from the coverage requirement
- Had advance payments of the premium tax credit sent to their insurance provider
- Are claiming the premium tax credit on their tax return
In addition, Publication 5187 includes a detailed glossary if terms related to the Affordable Care Act. It also addresses the new lines for reporting Affordable Care Act information on your tax returns, Forms 1040, 1040-A and 1040-EZ.
If you already have health care coverage, all you will need to do is simply check a box on your tax return.
What is the Affordable Care Act Penalty?
What happens if you simply ignore the Affordable Care Act? Unless you are part of a short list of individuals exempt from the penalty tax, the Affordable Care Act requires most Americans to have health insurance starting in 2014 or they will have to pay a penalty known as the Affordable Care Act tax penalty.
The amount of the Affordable Care Act tax penalty depends on several factors, including income and family size. To understand how much the Affordable Care Act tax penalty might be, the Tax Policy Center has a very useful tax calculator on its website that allows you to estimate the Affordable Care Act tax penalty for individuals and married couples who do not have health insurance coverage required by the Affordable Care Act.
Contact an Experienced Columbus Ohio Tax Attorney
Affordable Care Act Tax Planning
Every American needs to be aware of their obligations under the Affordable Care Act. The links in this article provide a good starting point of information. The tax lawyer at Porter Law Office, LLC is an experienced tax attorney with an advanced degree in taxation who provides tax planning services in Columbus, Ohio and throughout the United States. Porter Law Office, LLC is a boutique law firm that specializes in complex tax controversy and tax planning. The firm is conveniently located in the Columbus, Ohio suburb of Gahanna. If you have questions about your tax obligations under the Affordable Care Act, or the Affordable Care Act tax penalty, contact Columbus tax attorney Matthew R. Porter, Esq. today.