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ACA Fine & The Flat Rate Fees

The Obamacare fine is calculated based many variables which can be confusing. One of the most important factors is your MAGI. If your income does not exceed the IRS tax filing threshold, based on your filing status, then an ACA fine is in no way applicable.

Every year the IRS releases new filing thresholds for each filing status category. Our Obamacare calculator adjusts for such increases.

Taxpayers with relatively low wages will pay a flat rate fee which is being phased in over a number of years. In such cases, the household total maximum flat rate is capped at 300% of the standard individual fine in any given year. (see below)

In other words, 300% would only apply to a family while a single adult faces a maximum flat rate penalty capped at 100% of the fine assuming their income is low.

Visit the Obamacare penalty calculator to have the fine calculated for you. The following is the Internal Revenue Service’s (IRS) fee schedule for the Affordable Care Act’s individual mandate flat rate penalties:

Year 2014

$95 per adult; $47.50 for each child under 18;

Maximum of $285 for a family

Year 2015

$325 per adult; $162.50 for each child under 18;

Maximum of $975 for a family

Year 2016

$695 per adult; $347.50 for each child under 18;

Maximum of $2,085 for a family

Year 2017

2017 is the same as 2016.

Future Years

The flat rate Obamacare tax could increase in 2018 and beyond by amounts similar to that of the official inflation rate. Interval increases of less than $50 will be rounded down to the nearest $50 increment. It’s likely that any future Obamacare fine increases will be modest or even remain the same.

Comparing Your Flat Rate

You aren’t yet finished once you figure out your possible flat rate fine based on the above information. You’ll need to compare your flat rate sum to the alternative Obamacare fine which is based on a percentage of your income. Such income, when referring to the Obamacare penalty, is called ‘excess income’ by the Internal Revenue Service.

By comparing the fee based on any possible excess income calculation to the standard flat rate fine, you will have an accurate Obamacare fine, if any, for your situation. The fine is based on the greater of the two figures but cannot exceed an absolute maximum for extremely high earners.

Our Obamacare penalty calculator does all the work for you. You can also calculate your 2015 fine and 2016 fine if you can accurately estimate your income or more accurately your MAGI.