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Affordable Care Act Webinar by Intuit
- 1. Intuit Confidential What ItMeans for Individuals and Small Businesses
- 2. Intuit Confidential Meet yourhost… 2 Mike D’Avolio Senior Tax Analyst Accounting Professional Division
- 3. Intuit Confidential • Requiresindividuals be insured • Complicated and dense! • Marks a historic precedent
- 4. Intuit Confidential4 You needto be insured in 2014 Key Exemptions… Financial hardship Lowest cost plan exceeds 8% of your household income Your income is below tax-filing threshold Individuals without coverage for less than 3 months And others… Without insurance, you risk incurring a tax penalty
- 5. Intuit Confidential5 You’ve got options… EmployerBroker Medicaid Health Exchange
- 6. Intuit Confidential6 Businesses with50 or more full-time employees must offer it • Penalty: $2K/yr. for every employee starting with the 31st employee Employer-sponsored insurance Businesses with fewer than 50 full-time employees are exempt Tax credits available for employers who offer insurance • Eligibility: ≤25 employees; avg. wages ≤$50K; employer covers ≥50% of coverage Affordable options are available (e.g. HRA, HSA)
- 7. Intuit Confidential7 Health Exchanges Publicexchanges will be available in all 50 states Plans have four levels of coverage: Platinum, Gold, Silver and Bronze Subsidies available for those that are financially eligible All plans offer “minimum essential coverage” Private exchanges are an alternative
- 8. Intuit Confidential8 Are youeligible for a subsidy? Determine your household size Determine your household income If it falls within the guidelines relative to the Federal Poverty Line, you’re eligible: Persons in household Federal Poverty Line ($/yr.) Income Level Premium as a Percent of Income 1 $11,170 Up to 133% FPL 2% of income 2 $15,130 133-150% FPL 3 – 4% of income 3 $19,090 150-200% FPL 4 – 6.3% of income 4 $23,050 200-250% FPL 6.3 – 8.05% of income 5 $27,010 250-300% FPL 8.05 – 9.5% of income 6 $30,970 300-400% FPL 9.5% of income 7 $34,930 8 $38,890 1 2 3 Stay tunedfor an Intuitsubsidycalculator!
- 9. Intuit Confidential9 Can’t affordinsurance? 17%† 83%†† Meet Mary, a school teacher and a single mother with one child. She earns $45K a year. Based on her subsidy, the state covers 17% of her premium: % of Premium Paid by Mary Assumes annual premium of $5,160. † Amounts to $885; † † Amounts to $4,275
- 10. Intuit Confidential Common Myths Misconceptionsand Facts About The ACA
- 11. Intuit Confidential Myth #1 Thepenalty for not having insurance is insubstantial.
- 12. Fact: The penaltycan be significant. In 2016… • The penalty is the greater of $695/yr. OR • 2.5% of income Examples: Family of 4 earning $25K would pay $695 Family of 4 earning $100K would pay $2,500
- 13. Intuit Confidential The penaltyis phased in over time 13 Flat fee portion % of household income portion 2014 $95 1% 2015 $325 2% 2016 $695 2.5%
- 14. Intuit Confidential Myth #2 Idon’t need to do anything until 2014.
- 15. Intuit Confidential Fact: Thereare things you can do this year! • April 15th , 2013: Keep your 2012 tax return as it will determine your subsidy-eligibility • October 1st , 2013: You can start enrolling in a insurance plan on public exchanges • January 1st , 2014: Make sure you’re insured!
Editor's Notes
- #4 The Affordable Care Act was passed in 2010. It overhauls the U.S. healthcare system and affects nearly all taxpayers, many employers and various elements of the healthcare industry. This represents the most significant change to our healthcare laws since the passage of Medicaid and Medicare in 1965. The new law will be phased in over multiple years spanning 2009 to 2018, with the individual mandate taking effect on January 1, 2014. The new healthcare law uses the tax code and tax return in many respects to implement its measures.
- #5 Exemptions will be granted for: Financial hardship; Religious objections; American Indians; Individuals without coverage for less than 3 months; Aliens not lawfully present in the U.S.; Incarcerated individuals; Individuals whose lowest cost plan option exceeds 8% of household income; or Individuals with income below the tax filing threshold ($9,750 single; $19,500 married filing joint)
- #6 You have several options to get health insurance… Job-based coverage : If your employer offers health insurance coverage, you may be eligible to receive it (including your spouse or dependents). Employers may decline or restrict coverage for certain reasons (part-time worker), but not for health reasons. Private policy: Beginning in 2014, these plans will cost the same whether acquired directly or through an exchange. However, subsidies apply only if you ’re using an exchange. Medicaid: Each state offers this program for lower income people, the elderly and people with disabilities. Health Insurance Marketplace (exchange): Beginning in 2014, this program helps you find health insurance that fits your budget. When you use an exchange, which are run by the state or federal government, it results in a private insurance policy (the government does not issue the policy).
- #8 Many Americans believe that the exchange is where they can go to get enrolled into a new government run insurance plan, which will be offered along with the private health care insurance plans currently available in the market today. This is not the case. There is no government run insurance plan or single payor system established under the Affordable Care Act. The government will only run the exchanges; the insurance industry will still be run by private companies.
- #10 Based on the table, 9.5% of her income (or $4,275) needs to be applied to insurance. Assume that an average annual premium equals $5,160. $4,275 divided by $5,160 is around 83%. Consequently, Mary pays 83% of premium and the subsidy covers 17%.
- #16 Beginning in October 2013, uninsured Americans will be able to enroll in a health plan through state and federal exchanges. Your 2012 tax return will help determine your eligibility for an insurance subsidy from the government, which will help you purchase health insurance under the health care law. There is noting special to do; your tax return determines eligibility. In 2014 everyone, except for a few, will be required to purchase health insurance or face a tax penalty.