Courtesy of CNN
Many Americans are furious that Obamacare will require them to buy health insurance.
Most of these folks seem to hate the idea that Obama is forcing them to do something more than they hate the idea of shelling out money.
But for those who also care about the money, here are the details.
The good news is that, for most people, the "penalty tax" for those who choose not to buy health insurance will cost a lot less than health insurance.
As with everything tax-related, there's no simple answer to "How much is the Obamacare penalty tax?" But here are some key points, from FactCheck.org :
- The penalty/tax will be phased in from 2014 to 2016.
- The minimum penalty/tax in 2016 will be $695 per person and up to 3-times that per family. After 2016, these amounts will increase at the rate of inflation.
- The minimum penalty/tax per person will start at $95 in 2014 (and then increase through 2016)
- No family will ever pay more than 3X the per-person penalty, regardless of how many people are in the family.
- The $695 per-person penalty is only for those who make between $9,500 and
$37,000 per year. If you make less than
$9.500, you're exempt. If you make more than$37,000, your penalty is calculated by the following formula.
created as part of Obamacare. The CBO estimates that these policies will cost $4,500-$5,000 per person and $12,000-$12,500 per family in 2016, with the costs rising thereafter.
So, basically, you're looking at penalties of approximately the following at the following income levels:
- Less than $9,500 income = $0
- $9,500 - $37,000 income = $695
- $50,000 income = $1,000
- $75,000 income = $1,600
- $100,000 income = $2,250
- $125,000 income = $2,900
- $150,000 income = $3,500
- $175,000 income = $4,100
- $200,000 income = $4,700
- Over $200,000 = The cost of a "bronze" health-insurance plan
The IRS will collect the penalty-tax, a fact that will no doubt further enrage those who hate Obamacare.
But here's some more good news for those folks:
The IRS will not have the power to charge you criminally or seize your assets if you refuse to pay. The IRS will only have the ability to sue you. And the most the IRS can collect from you if it wins the suit is 2X the amount you owe. So if you want to thumb your nose at the penalty-tax, the IRS won't be able to do as much to you as they could if you refused to pay, say, income tax.
By the way, the following folks will be exempt from the penalty-tax:
- Those who make less than $9,500
- Employees whose employers only offer plans that cost more than 8% of the employee's income
- Those with "hardships"
- Members of Indian tribes
- Members of certain religions that don't pay Social Security tax, such as Amish, Hutterites, or Mennonites
And, of course, Obamacare isn't free. So, whether you pay the penalty or not, you're going to have to pay a lot of other taxes to pay for it. Here they are >