• June 27, 2016
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The Individual Shared Responsibility Provision is an individual mandate designed with an aim to improve the quality and affordability of health insurance coverage in the US. One of the many Affordable Care Act tax provisions,  requires individuals to have a certain amount of health care coverage or minimum essential coverage (barring few exemptions), when filing the annual federal income tax return. People who do not have a minimum essential coverage or who do not qualify for the coverage exemption are required to pay a fine in the name of the individual shared responsibility payment. In this blog post, we take a closer look at the Individual Shared Responsibility Provision and its highlights. Let’s begin.

Whom Does the Provision Affect?

The Individual Shared Responsibility Provision applies to all individuals, including senior citizens, children, and resident aliens living in the US. Foreign nationals who decide to not become a resident alien, however, are exempt from the individual shared responsibility payment. Other individuals not required to bear the individual shared responsibility payment include:

  • Nonresident aliens
  • Dual status aliens or nonresident aliens who file a joint return with a U.S. spouse
  • Aliens who have both a resident and nonresident status during their first year in the US
  • Individuals who file a Form 1040NR-EZ or Form 1040NR
  • Individuals who are both non-US citizens and not lawfully present in the US

Minimum Essential Coverage

Applicants who have a minimum essential coverage must indicate it by checking a box on Form 1040, 1040A, or 1040EZ. Elements that come under the minimal essential coverage include:

  • Medicare Part A and Medicare Part C (also known as Medicare Advantage)
  • Most types of TRICARE coverage under chapter 55 of title 10 of the United States Code
  • Most employer-sponsored coverage, including COBRA, retiree, and self-insured plans
  • Coverage under an expatriate health plan
  • Most medicaid coverage
  • Children’s Health Insurance Program or CHIP coverage
  • Coverage provided to Peace Corps volunteers

Coverages that provide limited benefits do not fall under the minimum essential coverage. These include:

  • Medicaid coverage only related to pregnancy
  • Medicaid providing only family planning services
  • Medical for only tuberculosis-related services
  • Coverage limited to benefits such as
    • Dental or vision care
    • Worker’s compensation
    • Accident or disability policies

Coverage Exemptions

Applicants who do not qualify for the minimal essential coverage, but meet certain criteria, can file Form 8965, Health Coverage Exemptions, to skip the individual shared responsibility payment. These conditions can be the following:

  • You did not have a coverage for 3 consecutive months
  • You are a member of the health care ministry
  • You are a member of a religious sect that does not accept any insurance benefits
  • You are a member of the federally recognized Indian tribe
  • Suffered a hardship that makes it impossible to obtain a coverage
  • In jail, or some other correctional facility
  • Lawfully absent in the country and not a U.S. citizen or U.S. National

The Bottom Line

Applicants or any of their family members who do not have a minimum essential coverage, or qualify for a coverage exemption for any month, must bear the individual shared responsibility payment when they file their income tax return. Determining this payment depends on the total household income, age, and certain other factors. You may seek a meeting of a no-obligation consultation with Attorney, Nick Nemeth, to find out the exact requirements applicable to you and learn about any other prerequisites that may be a part of the equation. Nick Nemeth and his team can also assist you with all IRS tax issues. You can reach us at our  toll-free number: (888) 890-0523, or fill out this contact form to schedule an appointment.

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What Our Clients Have to Say

Susan WilsonSusan Wilson
03:27 25 Jan 23
I have been very pleased with the solid counsel and guidance that Nick Nemeth has provided me regarding my tax issue. I found him to be honest and straightforward which I appreciated. I was impressed with his relevant experience and knowledge . He has definitely brought me peace of mind during a difficult and stressful time.
Sarah HowardSarah Howard
03:44 14 Nov 22
I would like to thank Mr. Nick and his staff for the superb help that I received from them. My IRS problem was resolved quickly and efficiently. It took 2 visits to convince me that I was over my head. I thought that I could call the IRS, appeal my tax notices and settle on a payment plan on my own. After many phone calls to the IRS, waiting sometimes more than 4 hours with no resolution to speak of, it proved to be extremely difficult and stressful. Revisiting Mr. Nick was a huge wake up call. My account was reviewed, and a payment plan was established with the IRS within a week. I will be forever grateful to the staff who worked on my case and especially to Lorna who listened to me vent while going through this painful process.
00:33 07 Aug 22
I cannot say enough good things about Nick and his team. When I first met with Nick he was up front, honest, friendly and efficient. When I worked with one of his attorneys, Eric B, I was just as pleased. All of the staff there are nice and very helpful. I wish I hadn't waited so long to get help with my issue. Over 6yrs I tried getting through and getting anywhere with the IRS and hardly made any progress. I know this may not be the case for all, and even I thought it would take longer than it did, but 3mos and they had my situation straightened out. I still can't believe it. Thank you thank you THANK YOU for all that you did for me. This is a huge burden gone out of my life now thanks to you. If anyone needs help out there, I know you may not want to shell out more money to get their help but it may just save you in the long run.
Spoilly GirlSpoilly Girl
23:49 03 Aug 22
The Nemeth Law team is exceptional. They treat their clients like a family member who is in crisis. They want you to get the best possible outcome. I really appreciate everything that they did for me. Jake and Ashley had the greatest role in my case and it all turned out for the best for me. Thank you Nick and team for easing my fears and getting me through the long process. I'm truly grateful.
Eddie WaltEddie Walt
19:44 12 Jul 22
During a time in which competent, professional service at a fair price seems to have disappeared, Mr. Nemeth and his team are a refreshing breath of fresh air.From my first phone call to the final settlement of our case with a non-responsive IRS, they under-promised, over-delivered and were in constant courteous contact to make sure we knew exactly what was happening and where we stood.I hope to never need their services again, but, should I receive another friendly letter from the IRS...I know who to call!
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