Health Insurance Penalty 2018 Calculator

The Affordable Care Act (ACA) penalty, also known as the individual shared responsibility payment, is a tax imposed on individuals who do not have qualifying health insurance coverage for certain months during the year. This calculator helps you determine your 2018 penalty based on your income and household size.

What is the ACA Penalty?

The ACA penalty was established to encourage individuals to maintain health insurance coverage. If you're eligible for coverage but don't have it, you may owe a penalty. The penalty amount varies based on your income and household size.

The penalty was $695 per adult and $347.50 per child in 2018, with a maximum penalty of $2,085 per family.

Who is Eligible for the ACA Penalty?

You're eligible for the penalty if:

You were at least 18 years old
You were a U.S. citizen or resident alien
You were not enrolled in Medicare
You were not eligible for an exemption

When is the Penalty Due?

The penalty is calculated on a per-month basis and is due with your federal income tax return. If you don't have qualifying coverage for at least 3 months in a year, you may owe the penalty.

How to Calculate the Penalty

The penalty calculation follows these steps:

Determine your income level for the year
Identify your household size
Calculate the base penalty amount
Adjust for income level
Multiply by the number of months without coverage

Formula: Penalty = (Base Penalty × Income Adjustment) × Months Without Coverage

Base Penalty Amounts

The base penalty amounts for 2018 were:

$695 per adult
$347.50 per child

Income Adjustments

The penalty is reduced for individuals with incomes below certain thresholds:

No penalty for incomes below 100% of the federal poverty level
Partial penalty for incomes between 100% and 400% of the poverty level
Full penalty for incomes above 400% of the poverty level

Penalty Examples

Let's look at some examples to understand how the penalty works.

Example 1: Single Person with Income Below Threshold

A single person with an income of $12,000 (below 100% of the poverty level) would owe no penalty, regardless of months without coverage.

Example 2: Family of Four with Income Above Threshold

A family of four with an income of $50,000 (above 400% of the poverty level) and no health insurance for 6 months would owe:

Base penalty: $695 (adult) + $347.50 (child) × 3 = $1,737.50
Income adjustment: 100% (full penalty)
Total penalty: $1,737.50 × 6 = $10,425

Example 3: Individual with Income Between Thresholds

An individual with an income of $25,000 (between 100% and 400% of the poverty level) and no health insurance for 3 months would owe:

Base penalty: $695
Income adjustment: 50% (partial penalty)
Total penalty: $695 × 0.5 × 3 = $1,042.50

Penalty FAQ

When was the ACA penalty last applied?

The ACA penalty was last applied in 2018. The penalty was reduced in 2019 and eliminated in 2020 due to the COVID-19 pandemic.

Can I get an exemption from the ACA penalty?

Yes, you may qualify for an exemption if you have a financial hardship, religious objections, or other qualifying reasons. You must apply for an exemption through the marketplace.

How do I pay the ACA penalty?

The penalty is paid as part of your federal income tax return. You'll receive a notice from the IRS if you owe a penalty.

Can I appeal the ACA penalty?

Yes, you can appeal if you believe the penalty was applied incorrectly. You must file an appeal with the IRS within 60 days of receiving the notice.