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What happens if a consumer doesn't satisfy the individual mandate?


Those who don't have health insurance coverage or fit within an exemption will pay a tax penalty beginning in 2014. The penalty is set to increase each year as follows:

  • In 2014, it will be the greater of $95 per adult or 1% of taxable income above the filing limit.
  • In 2015, it will be the greater of $325 per adult, or 2% of taxable income above the filing limit.
  • In 2016, it will be the greater of $695 per adult, or 2.5% of taxable income above the filing limit.
  • After 2016, the tax penalty increases annually based on a cost-of-living adjustment.

The penalty starts after three months without coverage. For each month, the penalty due is 1/12 of the total annual penalty. The penalty for a child is half that of an adult. The total liability for a family is capped at 300% of the individual penalty. Only the first two children are counted to calculate the penalty.

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