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Elizabeth Davis

Avoid the Penalty for Being Uninsured With a Health Insurance Exemption

By November 7, 2013

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Image of a sign with the word exempt.As we get closer to January 1, 2014, the date all United States residents are supposed to have health insurance, more of the uninsured are wondering if they can afford to get health insurance. If they can't, they're asking how to avoid the tax penalty for being uninsured.

There are only 3 ways to avoid the penalty:

  • Get health insurance.
  • Get a health insurance exemption.
  • Belong to a group of people the government views as having health insurance coverage even if you're uninsured.

Although most of the uninsured can now get health insurance through their state's health insurance exchange (when the website is working), not everyone feels that coverage is something they can afford. If you find yourself in this situation, you can learn more about health insurance subsidies in "Can I Get Help Paying for Health Insurance?"

If you'll remain uninsured after January 1, you'll need an exemption or you'll owe a tax penalty for being uninsured. You can learn more about exemptions, as well as who the government views as having coverage even when they don't, by reading "Can You Get a Health Insurance Exemption?"

The type of health insurance exemption most likely to generate interest is the hardship exemption. It's aimed at helping folks who aren't able to get insurance due to a financial or situational hardship like a natural disaster, death in the family, or foreclosure. Learn who's eligible for this exemption in "How To Get a Hardship Exemption From Health Insurance."

Think you're exempt from health insurance? How you apply for the exemption is determined by what type of situation is making you exempt. Find out more in "How To Apply for a Health Insurance Exemption." If the exemption you're seeking requires you to apply through a health insurance exchange, you may have to deal with some delays as the exchanges get up to speed on exemption applications.

image ©Goodygreen/iStockphoto.com

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