Tax Subsidy and Obamacare – How To Know If I Qualify
As many of the changes begin to take place with the new health care reform, many people are wondering about how and when they will be able to receive the tax credits that were promised on the health insurance that they purchase.
These tax credits, which are actually government funded subsidies, can provide a real incentive for those who may otherwise not have purchased health insurance for themselves and / or their families in the past as they can save money on both health insurance premiums, as well as other out-of-pocket health care related expenses.
In addition to cost savings that are available to individuals, small businesses with less than 25 full-time employees are also eligible for certain types of tax subsidies on their health care insurance plans.
How Will You Receive Your Subsidy?
The subsidy that is received can help you in lowering the amount of money that is spent on your monthly health insurance premium, as well as on other costs such as your health insurance deductible, copayments, and coinsurance. In addition, it can also help in reducing other expenses such as your policy’s out-of-pocket maximum.
It is estimated that approximately 85 percent of the 8 million Americans who purchased health insurance through the health insurance exchanges will be eligible to receive a tax subsidy to assist them with their health care related expenses.
In order to receive your credit, it is not necessary to owe any amount of income tax. If you qualify for the subsidy, it will be paid directly to your health insurance carrier when you enroll in a health insurance plan. What this means to you is that it will not be necessary for you to wait until you have actually filed your tax return in order to receive the subsidy. What it also means is that it will not be necessary for you to pay the full amount of your health insurance premium when you apply for coverage. This is because you will automatically receive the credit up front upon purchasing the coverage.
How Much of a Credit Will You Receive?
The amount of subsidy that you receive will depend upon a couple of factors. These include the amount of income that you earn, as well as the number of people living in your household. Those households who have the lowest amount of income will receive the most in terms of credit for their health insurance coverage.
In addition, your age will also play a role in determining the amount of subsidy that you receive. Here, the older that you are, the more you may obtain. This is because health insurance premiums are typically higher for those who are older. There are several online calculators available that can help in walking you through obtaining the exact amount of credit you will receive based upon the exact income, age, and household size criteria that apply to you.
How to Know If You Qualify
In determining if you actually qualify, it will depend on how much you earn in comparison to the federal poverty level. For example, households of various sizes cannot earn more than 400 percent of the national poverty level and still qualify for the credit. If, however, your household earns under what is considered to be the 400 percent of the poverty level for a household of your size, you will qualify for the Obamacare health care tax subsidy.
The chart below outlines household sizes, as well as the amount of income for the year 2014 that is 400 percent above the national poverty level. Therefore, if a household of that size earns more than the given amount, they will not qualify. As an example, if a household of three individuals earns more than a total of $78,120 in 2014, they will not qualify. However, if they earn less than that amount, they will. (Note: For those individuals and / or households who earn less than the poverty level, it is possible that you may qualify for health care through the Medicaid program).
|Size of Household||400 Percent of National Poverty Level (2014)|
|For each additional person, add:||$16,080|
Where to Obtain Quality Health Insurance Coverage
If you are seeking quality and affordable health insurance coverage, we can help. We work with many of the best health insurance companies in the market today, and we can assist you in comparing the benefits and the premiums that will work for your particular needs. Whether you are seeking coverage for an individual or a family, we can match you up with the coverage that works best for you – and we can do it all from the comfort and convenience of your home computer without you ever needing to meet in person with an insurance agent. In order to get the process started, all you need to do is simply Click Here.
If you do happen to have any questions along the way, our expert staff will be happy to help in answering any inquiry or concern regarding health insurance policies, premiums, or benefit offerings. Please feel free to contact us directly, toll-free, at 864-491-5785. Choosing health insurance is a big decision, and we want to ensure that you are obtaining the benefits and coverages that are right for you at a premium that is right for your budget.