The Congressional Budget Office and the Joint Committee on Taxation estimate that under the Affordable Care Act, commonly known as Obamacare, about 6 million Americans without health insurance will have to pay a tax penalty.
The healthcare reform law requires that, starting in 2014, all Americans purchase health insurance or pay the penalty. By 2016, uninsured Americans will either pay a flat penalty that rises to $695 or a percentage of household income that rises to 2.5 percent, according to the CBO/JCT report Payments of Penalties for Being Uninsured Under the Affordable Care Act.
Not all uninsured Americans – projected by the CBO to be about 30 million in 2016 – will be subject to a penalty. Illegal immigrants are excluded. Low-income Americans will be subject to the insurance mandate but not the penalty portion. Other Americans will be exempted for religious or hardship reasons, the CBO said.
The CBO estimates the 6 million people subject to the penalty – including uninsured dependents whose parents or guardians will pay their penalty on their behalf – will result in $7 billion in collections in 2016 and $8 billion per year in 2017 to 2022. The CBO expects many of the uninsured to voluntarily report their status on tax returns and pay the penalty.
Read the full CBO report below.
Photo: Nurse with syringe (Angela Gaul / The Journal News)
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