Individual insurance mandate repeal

Your Guide to State, Local, Federal, Estate + International Taxation

insurance mandate, health care, reform, tax, IRSOn multiple occasions over the summer, Congress unsuccessfully attempted to repeal the Affordable Care Act. Now as part of the Tax Cuts and Jobs Act, Congress has repealed the individual health insurance mandate under the Affordable Care Act. However, it comes with a catch. The repeal is effective for months after December 31, 2018.

This means that the mandate and associated penalty will still be in effect for 2017 and 2018. Starting in 2019, the penalty for not having health insurance will be zero. For 2017, the penalty will remain the greater of

  1. 2.5% of household income, or
  2. $695 for adults and $347.50 for children with a maximum of $2,085

It’s important to note that only the individual mandate has been repealed. Many components of the Affordable Care Act. The Net Investment Income Tax, Additional Medicare Tax, Premium Tax Credit, are still in effect.

It remains to be seen if Congress will make further changes in the form of a full repeal, or other minor changes to the Affordable Care Act. However, those subject to the penalty will see some relief starting in 2019.

Richard Christensen