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Just in Time for Tax Day: What This Year’s Taxes Have To Do With Next Year’s Obamacare

By John M. Gonzales, CHCF Center for Health Reporting

Tax Form with Stethoscope

The income you declare this year will be used to determine if you’re eligible for a health insurance subsidy starting in January. (Getty Images)

If you’re among millions of uninsured Californians eligible for government-subsidized insurance, the ripples of health reform start with Monday’s tax deadline.

First, the government will use your return this year as its first yardstick for how much of a subsidy or tax break it contributes to your health coverage next year. And second, if you don’t have health insurance a year from now, a penalty will be added to your federal tax bill.

These are among ways the federal tax code will increasingly be at the forefront of health reform’s implementation.  Other provisions are also kicking in as the countdown continues toward full operation of the Affordable Care Act on Jan. 1.

The provision that will provide the biggest boost to taxpayers is the one that offers subsidies for uninsured people who obtain coverage through new insurance exchanges.

“It’s a tremendous deal for the people who are currently uninsured,” said Larry Levitt, senior vice president at the Kaiser Family Foundation. Continue reading