There Are 19+ Ways to Avoid the Obamacare Tax Penalty. Which Exemption Will You Use?

healthcare gov website

When you go to file your 2014 taxes, you’ll soon discover a new reporting requirement. You now have to tell the IRS whether or not you had health insurance in 2014. And if you didn’t have health insurance, you’re going to owe a tax penalty.

Depending on your income, this tax penalty could be well over $1,000.

Can you get it out of paying it? Well, yes… under certain circumstances you can. Fortunately, there are enough loopholes written into the law that most people will be able to avoid the Obamacare tax.

Almost none of the uninsured will end up paying the ObamaCare mandate penalty, according to an updated analysis by the Congressional Budget Office, which found that 87% will be able to claim an exemption.

That exemption rate is higher than the CBO had previously thought, which not only blows a hole in its budget forecast for the law, but also increases the odds of an insurance industry “death spiral.”

According to the CBO’s latest estimate, out of the 30 million people who will still be uninsured in 2016, just 4 million will end up paying any tax penalty, despite the law’s requirement that everyone buy government-approved insurance.

Obviously, it’s a good thing for you if you can avoid the tax penalty. You save money. But the more people who avoid the tax, the better. If nobody pays the penalty (or only a few people), then that could be the death knell for Obamacare.

So how do you get an exemption from paying the tax penalty? There are 19 different ways, plus a special “Hardship Exemption” category that provides an additional 14 exemptions.

For example, Christians can get an exemption if they participate in a medical bill-sharing ministry like Medi-Share. Even though medical bill-sharing is not technically health insurance, it provides similar benefits. So members of these services will not have to pay the tax penalty.

Here are a few of the other potential exemptions that could apply to a large number of people:

  • You recently experienced the death of a close family member.
  • You filed for bankruptcy in the last 6 months.
  • You had medical expenses you couldn’t pay in the last 24 months that resulted in substantial debt.
  • Your individual insurance plan was cancelled and you believe other Marketplace plans are unaffordable.
  • You experienced another hardship in obtaining health insurance.

Pay attention to that last exemption. It’s a general hardship exemption that could apply in many different circumstances. For example, you might qualify for the exemption if you applied for health insurance and were denied. Or you might qualify if you were accepted, but could not afford the premiums. And so on.

Since this is the first year that people are having to pay the Obamacare tax penalty, many tax preparers and CPAs will not be up to speed on all these exemptions. That’s why you must take matters into your own hands. Do the research yourself and do whatever you can to avoid the tax penalty. Hopefully this article will help you do that.

If you want to apply for a hardship exemption, you will need to make sure you check the correct box on your tax return and then submit this form. And if you’re interested, you can see a complete list of hardship exemptions here.

What do you think of the Obamacare penalty tax? Leave a comment below.

  • Deborah G

    So basically we can tell OBAMA to piss up a rope?

    • MeMyselfAndI

      deborah g, just make sure that wind isn’t blowing against you when do! The guy that directed, or at least issued the order to write this crappy law, is NOT looking out for you but rather himself.

  • Tids1960

    This is an illegal law…
    This is an unconstitutional law…
    Why in the HeII should I pay a penalty on fraud by criminals ?
    All three branches are guilty of fraud regarding Obamacare
    And this isn’t the only felonies these people are making…

    • Banjo

      I ask that last question almost daily! I completely agree with you, unfortunately, you are preaching to the choir here!
      I believe the whole Obamacare thing is a money-skimming scheme, sort of like the stuff the government buys for many times more than what it would actually cost you or I. It allows them to funnel the access to some pet projects(or best pals) without raising suspicion.
      If they are unable to cover the exorbitant costs involved with Obummercare, then the whole house of cards will crumble!
      Hopefully, we have enough people in power with enough balls to repeal it first…although it would be sort of fun watching Odumbo’s “legacy” crumble to the ground.

      I don’t know how true it is, but I heard that if a person already has an amount that they owe the IRS, they can’t fine you, sort of like a hardship.

      • Tids1960

        With as bad as Obamacare is… My fear is it was not only done intentionally, but to the point so they can push what they really wanted and we would agree without a peep. The thing is… I think they found a way to push what the employer had to pay back on to the employee… a sigh of hand if you will.

        • Banjo


        • FreeWoman

          That’s “sleight,” not “sigh.”
          Don’t tell me I can’t go where I want, when I want, dressed like I want, drink as much as I want. Tell them not to rape.
          If I pass out drunk and naked in an upstairs bedroom in a frat house, no one has a right to have sex with me without my consent. My doing stupid things doesn’t give anyone the right to rape me or do anything to me without my consent. Tell them not to rape!

          • Tids1960

            Thank you…
            I was using a dictation program on my phone, And didn’t check it

  • Richard Bagenstose

    did you hear yet , oboma is spending 300 million to hire privet contractors to take obomacare to kenya,

  • The signs of the end times are everywhere…

    As we witness such things as the spread of globalism, the building of a one-world church, the increase of wickedness, the breakdown of the traditional family, the destruction of that priceless bastion of liberty called America, the normalization of homosexuality, the callous murder of babies, the filthy pop culture, the breathtaking increase in governmental surveillance, we become fearful, uncertain, frustrated, angry, and discouraged, but this is because our minds and hearts are too focused on things of this world rather than things above. Too often we have the same short view that “conservative” unbelievers have rather than the long view that comes from the light of Bible prophecy…

    The devil is the god of this world, and his handiwork is evident everywhere, but he is not God and he is not in control of the times and the seasons.

    “Daniel answered and said, Blessed be the name of God for ever and ever: for wisdom and might are his: And he changeth the times and the seasons: he removeth kings, and setteth up kings: he giveth wisdom unto the wise, and knowledge to them that know understanding” (Dan. 2:20-21).

    We should stand in the confidence that the present evil is exceedingly temporary and will soon be cut down….

    Please visit our Bible Prophecy website at:

    • Col C

      I too believe it will be cut down, but are you ready for the complete desolation it will cause before the rebuilding, or what we might have to endure before the end? I pray and intercede for our country continually.

  • Tracy Jones

    The OBUTTHEADCARE penalty tax is UNCONSTITUTIONAL that’s ALL that has to be said!!!!!!!!!!!!!!!!!!!!!!!!!!

  • suz

    Obama can take his tax and shove it up his $#@ it’s illegal and unaffordable and it’s hurting the healthcare field

  • Frank W Brown

    A Country Founded by Geniuses but Run by Idiots!

    If you can get arrested for hunting or fishing without a license, but

    not for entering and remaining in the country illegally — you might

    live in a nation that was founded by geniuses but is run by idiots.

    If you have to get your parents’ permission to go on a field trip or

    to take an aspirin in school, but not to get an abortion — you might

    live in a nation that was founded by geniuses but is run by idiots.

    If you MUST show your identification to board an airplane, cash a

    check, buy liquor, or check out a library book and rent a video, but not

    to vote for who runs the government — you might live in a nation that

    was founded by geniuses but is run by idiots.

    If the government wants to prevent stable, law-abiding citizens from

    owning gun magazines that hold more than ten rounds, but gives twenty

    F-16 fighter jets to the crazy new leaders in Egypt — you might live in a

    nation that was founded by geniuses but is run by idiots.

    If, in the nation’s largest city, you can buy two 16-ounce sodas, but

    not one 24-ounce soda, because 24-ounces of a sugary drink might make

    you fat — you might live in a nation that was founded by geniuses but is

    run by idiots.

    If an 80-year-old woman or a three-year-old girl who is confined to a

    wheelchair can be strip-searched by the TSA at the airport, but a woman

    in a burka or a hijab is only subject to having her neck and head

    searched — you might live in a nation that was founded by geniuses but

    is run by idiots.

    If your government believes that the best way to eradicate trillions

    of dollars of debt is to spend trillions more — you might live in a

    nation that was founded by geniuses but is run by idiots.

    If a seven-year-old boy can be thrown out of school for saying his

    teacher is “cute,” but hosting a sexual exploration or diversity class

    in grade school is perfectly acceptable — you might live in a nation

    that was founded by geniuses but is run by idiots.

    If hard work and success are met with higher taxes and more

    government regulation and intrusion, while not working is rewarded with

    Food Stamps, WIC checks, Medicaid benefits, subsidized housing, and free

    cell phones — you might live in a nation that was founded by geniuses

    but is run by idiots.

    If the government’s plan for getting people back to work is to

    provide incentives for not working, by granting 99 weeks of unemployment

    checks, without any requirement to prove that gainful employment was

    diligently sought, but couldn’t be found — you might live in a nation

    that was founded by geniuses but is run by idiots.

    If you pay your mortgage faithfully, denying yourself the newest

    big-screen TV, while your neighbor buys iPhones, time shares, a

    wall-sized do-it-all plasma screen TV and new cars, and the government

    forgives his debt when he defaults on his mortgage — you might live in a

    nation that was founded by geniuses but is run by idiots.

    If being stripped of your Constitutional right to defend yourself

    makes you more “safe” according to the government — you might live in a

    nation that was founded by geniuses but is run by idiots.

    If the media panders to your openly socialist leader while the IRS targets groups with dissenting views— you might live in a nation that was founded by geniuses but is run by idiots.

    If your government ‘cracks down’ on legal gun sales to law abiding citizens while secretly supplying illegal guns to Mexican drug cartels— you might live in a nation that was founded by geniuses but is run by idiots.

    If your local government (Chicago) outlawed gun ownership for ‘the safety of its citizens’ and now boasts the worst murder rate in the country — you might live in a nation that was founded by geniuses but is run by idiots.

    What a country!

    How about we give God a reason to continue blessing America?

    This was borrowed from another blog, author unknown, please spread it far and wide!

  • runnindeer

    I listened to a black guy on channel 2 this morning on the George Stephanoloposis , however you spell his name show, and the guy was saying how that” pres., o did love this country because he had provided health care for the millions that didn’t have it before.” I watched the mans face while he spoke and he was serious I think. About as much as Juan Williams is serious when he fawns all over O about doing nothing more than sitting in the White House and playing golf or vacationing. O is black so that sizes it up for too many black people it seems. Never mind all of the obvious wrongs committed by the man. Forget that if the man was a Republican or white he would have been long crucified at the cross of public opinion by majority black that now support o because of his skin tone. It sure must be great to be able to have the privilege to sit there and screw up a country and play with peoples lives like o does . Especially while having Muslims to back you from the highest corners of this country’s defense headquarters and a black guy in the Justice department that is just as completely determined as you are to cause as much destruction and trouble for every white person and especially for older white’s and Republicans as they possibly can before they might be stopped. Maybe stopped. ? It is now up to those people that we the people elected to stop o.

    • Lee

      Blacks love him because he is screwing the white man. They don’t realize he is screwing them too.

  • David g.

    It’s part of Obama’s lawlessness in wealth redistribution and commie democraps helped him steal our money. You blue dog democraps sure now how to @&$# America and it’s citizens. Why can’t people see that democraps do the most damage to everyday hard working citizens? how?
    by voting for them and giving them the power to continue to take away whatever they feel like, period.

  • Mys77

    So…anyone out there feel healthier because of Obamaidon’tcare tax? Improve your healthcare? Anyone? Everything government touches and involves itself in, it destroys.

  • Zeke

    I don’t know what’s sadder – that these anti-Obama people are willfully putting their family’s health at risk, or that they or their kids need surgery they can’t afford, they will gladly ask taxpayers like me to foot the bill for their medical costs. Leeches.

    • cutterguy

      The saddest is that you are obviously pro-obummer

      • Zeke

        Yeah, it easy to whine about the government trying to ensure that all Americans have health care when the government already picks up the tab for yours.

        • cutterguy

          I’m not whining. I put in my time. Any body who spent time in service to this great country can qualify. Where did you serve your time I wonder.

          • Zeke

            No, you’re whining about how Obamacare, which facilitates people getting private sector health insurance, is 100x worse than your government provided insurance. Does this mean you would like the government to nationalize health care?

            Or are you simply another government-can’t-do-anything-right-and-should-be-smaller-let-the-market-decide tea partier?

          • cutterguy

            if it were private sector, it would not be subsidized by taxes. Where did you say you served your time?

          • Zeke

            Wasn’t in the military, nor am I diminishing your choice to serve. Why, is this relevant somehow?

            Seems to me that oil companies, farmers, car companies, etc. all receive generous government subsidies. Are these not private sector?

          • cutterguy

            oil cos. get subsidies for exploration. when they are allowed to drill, they pay loads of money to the economy. farmers. without them we don’t eat. not all farmers get them any way. car cos. the one that was bailed out is in trouble a lot; the one that did not take bailout came out in good shape. without subsidies, wind and solar cannot even exist. they are not profitable without subs. they do not give back to the economy. not sure what you mean by “etc.”.

          • Zeke

            I really can’t tell if you just don’t know what “etc.” means or if you’re unaware that private health care companies that receive gov’t subsidies are still private sector.

          • cutterguy

            etc. stands for ” and so forth” in different words. I know what it means, I”m not sure what your extension is. The indication is there are more govt subsidies. There are many more than mentioned, but not all are relevant to the discussion.

          • Zeke

            The relevance is that I was replying to your assertion that “if it were private sector, it would not be subsidized by taxes.”
            Because you disagree with a subsidy to a company or an industry doesn’t mean they are no longer private sector.

  • Col C

    My husband is insured with his work, but to add my son and I, it would be $1100.00 a month, yes, that is the letter we got from my husband’s employer, $1200 a month, would cover all three of us. I and my son, see a chiropractor about twice a year, costing me about $200. Let me see…$200 a year or $14,200 a year? I already pay car insurance which is crazy too, but no where near as crazy as this. The ObamaCare tax takes over one sixth of our economy, and it is nothing but an unConstitutional grab for power, and money. If I pay this tax, we won’t be able to buy food for half a year or more, and that is if food prices stay the same as they are right now, and we know that is not going to happen. Why are we letting these criminals in the IRS and White House, continue to persecute “We the People”? I agree with Tids1960, why aren’t they in jail, what’s it going to take?

  • cutterguy

    Thank God for VA health care. Even with the supposed problems, none of which I have seen in the twenty years I have been treated by them, it is 100x better than obiteme care. It is also suppose to be credible care.