Tax Advisor in Santa Rosa/Sonoma County Highlights Ways Affordable Care Act Affects Your Taxes
The details of taxpaying change every year. The Affordable Care Act is just one example of how taxes change. Since everyone has heard of ACA (Obamacare), we’ll highlight some of the tax changes in 2015 and 2016 that have to do with the ACA. Keep in mind, though, that there are many more changes every year, and that these are just a small sampling. Also, while the following information comes from irs.gov and sba.gov, it is not meant to be legal advice. For advice regarding your specific situation, please visit irs.gov or see a tax advisor in Santa Rosa or Sonoma County.
The “individual shared responsibility provision” of the ACA is the part that affects your family’s taxes. You and every member of your family must obtain minimum essential coverage, or you will make an individual shared responsibility payment on your federal income tax return. But did you know that some individuals can file for exemption? You might be exempt if they consider even the minimum coverage unaffordable for you, if you only had a short coverage gap, if you are a citizen living abroad or a non-citizen, if you are a member of a federally-recognized Indian tribe, if you are incarcerated, or if you are a member of certain religious sects. To learn the details of these and more exemptions, including how to get your exemption granted, visit irs.gov or see your tax advisor in Santa Rosa or Sonoma County.
As for the tax implications for your business, there are 56 frequently asked questions on irs.gov solely about Employers Shared Responsibility provisions! If you employ 50 or more full-time employees, you either have to offer affordable health coverage that provides a minimum level of coverage to full-time employees and their dependents, or you may be subject to an Employer Shared Responsibility payment. This sounds simple enough to someone who is not running a business, but if you are an employer, you come up with all sorts of questions. “What do they consider full time?” (Basically an average of 30 hours a week.) “Do two part time employees equal one full-time employee?” (If they work enough hours, yes!) “Do seasonal employees count? What if I’m a non-profit? Is it better to offer the coverage or just pay the Employer Shared Responsibility payment?” Or, “What if I have fewer than 50 employees but I want to offer coverage—are there any special programs for me?” (Yes!)
The ACA is just one of the many factors in the ever-changing world of taxes. Visit irs.gov for answers to more of your questions, or for advice that you can be assured is the best for your family or business, call Susan Adamson, your trusted tax advisor in the Santa Rosa/Sonoma County area. CONTACT US or call (707) 799-2705 today!