New Jersey Individual Mandate Guide
History of legislation
The State of New Jerseys individual mandate, requiring residents to have qualifying coverage throughout the year, went into effect on January 1, 2019. It was signed into law on May 30, 2018. The state released reporting requirements in June 2019 and continues to release more information.
Employers are required to report annually by the federal deadline . The employee mail form deadline is March 2, 2021.
In-state and out-of-state employers who employ New Jersey residents, even if the employer does not withhold New Jersey payroll taxes. The reporting obligation is limited to Applicable Large Employers , but requirements differ based on whether the employer offers self-insured or fully-insured coverage.
If an ALE is sending 1095-C forms to employees and filing 1095-C and 1094-C forms with the IRS, they are required to file forms with the state. Employers who only have fully-insured coverage should verify that their insurer will fulfill the reporting requirements for the state. If an ALEs insurer does not meet the obligation to file, the employer is required to file themselves. Likewise, all ALEs who participate in a multi-employer plan should verify reporting with their plan sponsor, or they will be required to file themselves.
New Jersey individual mandate penalties
Process for filing
Frequently asked questions
If you replace or correct files with the IRS, should these files be shared with New Jersey?
Covered California Enrollment: 2014
2014: 1,405,102 people enrolled in private plans through Covered California during open enrollment for 2014 coverage.
2015: 1,412,200 people enrolled in private plans through Covered California during open enrollment for 2015 coverage.
2016: 1,575,340 people enrolled in private plans through Covered California during open enrollment for 2016 coverage.
2017: 1,556,676 people enrolled in private plans through Covered California during open enrollment for 2017 coverage.
2018: 1,521,524 people enrolled in private plans through Covered California during open enrollment for 2018 coverage. Total enrollment, including renewals, was slightly lower than it had been in 2017, but the lower enrollment volume may have been due to the states approach to handling the Trump Administrations decision to end federal funding for cost-sharing reductions . California led the way in encouraging non-subsidy-eligible enrollees who preferred silver-level plans to shop outside the exchange in order to avoid having the cost of CSR incorporated into their premiums.
2020: 1,538,819 people enrolled in private plans through Covered California during open enrollment for 2020 coverage. This was about 1.6 percent higher than the prior years enrollment, after three straight years of year-over-year enrollment declines. Californias new individual mandate and state-funded premium subsidies are a big part of the reason enrollment increased .
What If I Have Concerns About Affording Health Insurance
Health insurance can be expensive, but the good news is there are quality health insurance plans available at an affordable rate. The even better news is that you may qualify for a new subsidy program for low and middle income California residents.
In the past, individuals that earned between 138% and 400% of the federal poverty level were eligible for federal tax credits through Obamacare. The new California program will extend premium tax credits for taxpayers who make between 400% and 600% of the federal poverty level. This means individuals who make between $50,000 and $75,000 per year will qualify for subsidies and families who make between approximately $103,000 and $154,500 per year will qualify as well. The state subsidies will be offered in addition to any federal tax credits in which an individual is eligible.
Take advantage of the current open enrollment season to research your potential health insurance options and avoid tax penalties in the future. Freeway Insurance can determine if you qualify for a health care subsidy to cover some of your health insurance costs. Give us a call at or request a free California health insurance quote online.
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How Is The Tax Penalty Calculated If I Only Had Health Insurance For Part Of The Year
The tax penalty is assessed for each month that a person is not covered. It is pro-rated, so that a person who is not covered for only a single month would pay 1/12th of the tax that would be due for the full year. For example, the minimum tax per person for failing to get coverage would be $7.92 for each month of 2014, $28.75 for each month of 2015, and $57.92 for each month of 2016, when fully phased in.
Why Do I Have An Insurance Penalty In 2021
Posted: October 23, 2020
If you are a Californian with no health insurance in 2020, you may face a tax penalty in 2021. Though in 2019 the Trump administration rescinded the tax penalty established by the Affordable Care Act, you may still need to pay a tax penalty in 2021 if you live in California and do not have health insurance.
Your options are either to not carry health insurance and pay a penalty at tax time or to enroll in a qualified insurance plan and avoid paying the penalty, though some exceptions may apply depending on your circumstances.
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A Brief History Of Healthcare Reform
In 2010, the Patient Protection and Affordable Care Act or Obamacare was passed with the goal of making healthcare more accessible to people nationwide. The ACA prevented people from being denied or charged more for health insurance due to having preexisting medical conditions.The federal mandate also required health insurance companies to meet specific requirements to ensure that people of any age or health status could receive coverage. Individuals who chose to remain uninsured faced a financial penalty during the tax season.
In 2019, the financial penalty was removed with the Tax Cuts and Jobs Act. People could opt out of health insurance without fear of encountering a penalty and with no federal mandate in place, health insurance costs started to skyrocket.
The individual mandate in California was announced in 2019 when Governor Gavin Newsom and other advocates revealed their plans for the Act. Similar to Obamacare, the Act aimed to give more people the healthcare coverage they needed while lowering the overall cost of healthcare for everyone in the state.The individual mandate was voted upon by state legislators in June 2019 and Governor Newsom signed it into law in July of the same year.
State Individual Mandate Penalties
With the elimination of the federal individual mandate penalty, some states have implemented their own mandates and penalties:
- Massachusetts already had a mandate and penalty, which has been in place since 2006. The state had not been assessing the penalty on people for whom the federal penalty applied, but started assessing the penalty again as of 2019.
- New Jersey implemented an individual mandate and an associated penalty starting in 2019.
- The District of Columbia also implemented an individual mandate and associated penalty as of 2019.
- Rhode Island created an individual mandate and associated penalty as of 2020.
- California created an individual mandate and associated penalty as of 2020.
Most of the states with individual mandates have modeled their penalties on the federal penalty that was used in 2018, which is $695 per uninsured adult , up to $2,085 per family, or 2.5% of household income above the tax filing threshold, although there are some state-to-state variations.
Vermont has an individual mandate as of 2020, but the state has not yet created any sort of penalty for non-compliance.
Maryland has created a program under which the state tax return asks about health insurance coverage, but instead of penalizing uninsured residents, the state is using the data in an effort to get these individuals enrolled in health coverage. Other states have since followed Maryland’s lead in creating an “easy enrollment” program.
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Best Option If You Have Have To Offer Health Insurance To Employees
A couple of considerations before we jump into the option.
Okay…so based on those three points, here’s the plan.
We first run a quote across all carriers at the Silver or Bronze level to seewho is priced best for your company’s situation.
There are even skinny network options which can reduce premiums by 10-15%.
Once we have the best priced plan at a given level , we can runworksheets for each employee.
The worksheet will show the cost to them based on employer contribution of50% towards bronze plan.
The employee can then pick and choose from any of the levels and pay thedifference with pre-tax dollars.
They will pay with pre-tax money with the POP 125.
Average savings of 25% so the realcost is $150 for the employee. They avoid a separate penalty for not havingcoverage of 2.75% of income.
At $40K salary, that’s $1000/year or $80/month.
Contact The Experts At New City Insurance
Tax penalties can come as a surprise for people who are not familiar with the 2020 changes to California health insurance coverage. To learn more about the tax penalty for not having health insurance in California or to request a consultation with an insurance professional, contact New City Insurance.
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Massachusetts Individual Mandate Guide
History of legislation
The State of Massachusetts individual mandate, requiring residents to have qualifying coverage throughout the year, went into effect in 2006 and predates the Affordable Care Act.
Employers are required to report annually. The reporting period is from Nov 1 to Nov 30. State filing deadline is Dec. 15. The employee form mail deadline is Jan. 31.
Unlike the state mandates enacted after the Affordable Care Act, the only employer reporting obligations relates to Form 1099-HC. Most insurance companies issue the forms on the employers behalf and send the state a reporting listing all the Form 1099-HC they issued.
Employers must file a Health Insurance Responsibility Disclosure form, which collects employer-level information about your employer-sponsored insurance offerings. The HIRD reporting is administered by MassHealth and the Department of Revenue through the MassTaxConnect web portal. The HIRD form will assist MassHealth in identifying its members with access to qualifying ESI who may be eligible for the MassHealth Premium Assistance Program.
Process for filing
If your insurance company doesnt file Form 1099-HC on your behalf, you are required to either upload the XML files through MassTaxConnect. More information about the requirements and how to file can be found here. If your company has less than 500 Form 1099-HCs to submit, you can do a mapped data upload.
Tax Penalty For No Health Insurance 2020
What is the penalty for not having health insurance? A taxpayer who fails to get health insurance that meets the states minimum requirements will be subject to a penalty of $695 per adult, or 2.5% of annual household income, whichever is higher when they file their 2020 state income tax return in 2021. The penalty for a dependent child is half of what it would be for an adult. According to Covered California, a family of four that has no insurance for the entire year could face a penalty of at least $2,000.
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Open Enrollment For Health Insurance In 2023
Open enrollment is when you can enroll in a health insurance plan through the. Coverage begins the first day of the month after you sign up. The open enrollment period for health insurance coverage in 2022 ended on January 15, 2022.
For states that use the federal Affordable Care Act exchange, the 2023 open enrollment period begins November 1, 2022 and ends December 15, 2022 in most states. States may have different date ranges.
How Do I Avoid The Individual Mandate Tax
To avoid this penalty and protect yourself from the potential financial burden of unexpected medical expenses, you can enroll in a health insurance plan during the open enrollment period. For 2021 coverage, the national open enrollment period will take place from November 1st 2020 through December 15th 2020. Some states have extended this period. To learn about your states open enrollment period, read our article, 2021 Obamacare Open Enrollment Dates by State.
If you lose your insurance in the middle of the year, you may qualify for a special enrollment period to purchase an ACA-compliant plan on the public exchange. You may buy an ACA-compliant plan outside the public exchange anytime. Depending on which state you live in, you may be able to enroll in short-term health insurance to help fill any coverage gaps you may experience throughout the year.
Your health and financial well-being are important to us. As the largest online health insurance broker, eHealth offers a variety of health insurance plans to fulfill your coverage needs, wherever you live in the United States. These include on and off exchange ACA-compliant plans, major medical insurance, and short-term health insurance. Let us help you explore your coverage options now. Simply click Individual & Family Health Insurance to find affordable insurance. Our licensed insurance agents are here to help you and share their expertise as you consider your choices.
If You Had No Health Coverage
Unlike in past tax years, if you didnt have coverage during 2021, the fee no longer applies. This means you dont need an exemption in order to avoid the penalty.
Important: Some states have their own individual health insurance mandate
If you live in a state that requires you to have health coverage and you dont have coverage , youll be charged a fee when you file your 2021 state taxes. Check with your state or tax preparer.
You will NOT get Form 1095-A unless you or someone in your household had Marketplace coverage for all or part of 2021.
Affordable Care Acts Coverage Mandate
Under the ACA, also called Obamacare, Americans who were not otherwise eligible for an exemption were required to have health insurance coverage for themselves and their families. Failure to have minimum health insurance triggered a tax penalty at the same time, the ACA allowed for the creation of a premium tax credit to help Americans offset some of the cost of getting health insurance through the Health Insurance Marketplace.
This rule changed in January 2019, when the tax penalty mandate for health insurance was eliminated. While the ACA technically still exists, Americans who choose not to maintain health insurance for themselves or their family members in 2019 and beyond wont be penalized at tax time. Its estimated that as many as four million Americans will choose not to have health insurance coverage this year as a result of the penalty being eliminated.
As a result of the American Rescue Plan Act of 2021, all taxpayers with insurance bought on the ACA Marketplace are now eligible for the ACA premium tax credit previously, filers were ineligible if their income exceeded 400% of the federal poverty line.
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No Mandatory Health Insurance: Advantages
The primary upside to health insurance no longer being mandatory at the federal level is the money you dont have to spend on premiums that remains in your pocket.
If youre young and healthy, its possible to get by without paying a monthly bill for health insurance, which saves you money, says Chane Steiner, CEO of Crediful, a personal finance website. That could be helpful if youre trying to pay off student loans or save money toward a down payment on a home.
Of course, if your employer offers some type of health insurance coverage as part of your benefits package, you may be able to get affordable coverage without having to shop around for it.
Christina Nicholson, owner of Media Maven, opted to cancel her health insurance and pay out of pocket for pregnancy-related medical expenses that her plan didnt cover. She first considered adding herself to her husbands health insurance, but their premiums would have increased by more than $1,000 per month, so she opted to pay her own medical bills.
Fortunately, she was able to negotiate discounts from her hospitals and doctors, which ended up costing her significantly less money than she would have paid had she been covered. In one instance, the difference between the cost of medical tests with insurance was $1,900 more than her negotiated fee without insurance.
Make Sure You Have Health Coverage
The mandate, which takes effect on January 1, 2020, requires Californians to have qualifying health insurance coverage throughout the year.
Many people already have qualifying health insurance coverage, including employer-sponsored plans, coverage purchased through Covered California or directly from insurers, Medicare, and most Medicaid plans.
Under the new mandate, those who fail to maintain qualifying health insurance coverage could face a financial penalty unless they qualify for an exemption.
Generally speaking, a taxpayer who fails to secure coverage will be subject to a penalty of $695 when they file their 2020 state income tax return in 2021. The penalty for a dependent child is half of what it would be for an adult.
The penalty is based on your state income and the number of people in your household.
Summary of possible penalties
To avoid a penalty, California residents need to have qualifying health insurance for themselves, their spouse or domestic partner, and their dependents for each month beginning on January 1, 2020.
The open enrollment period to sign up for health care coverage through Covered California is scheduled for October 15, 2019 through January 31, 2020.
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Which Health Insurance Carriers Offer 2022 Coverage In The California Marketplace
As of 2021, there are eleven insurers that offer exchange plans in California. Covered California announced in July 2021 that an additional insurer, Bright HealthCare, will be joining the marketplace, bringing the total number of participating insurers to 12.
The following insurers will offer plans in the California exchange as of 2022, with plan availability varying from one location to another:
- Anthem Blue Cross of California
- Blue Shield of California
- Valley Health Plan
- Western Health Advantage
Three existing insurers plan to expand their coverage areas as well: Anthem Blue Cross of California, Blue Shield of California, and Valley Health Plan. As a result, all residents will be able to select from at least two insurers, and most Californians will be able to select from among four insurers.