If you can't pay for health insurance coverage so that you are now facing the penalty fee under the Affordable Care Act (ACA) or "Obamacare," and you filed bankruptcy in the last six months, you may be eligible for a hardship exemption.

You may face a fee or penalty of as much as 1% (or $95 per person) of your household income for not having health insurance in 2014. It goes up to 2% or $325 per person for 2015. Only the amount of income above the tax filing threshhold is subject to the penalty.

But there are certain exemptions from the payment, such as if your income is too low, or the lowest cost coverage would be more than 8% of your household income, etc.

There are also what are called hardship exemptions, such as if you were homeless, you were evicted in past 6 months or were facing eviction or foreclosure,or if you filed bankruptcy in the last 6 months, and a few others.

A Houston, Texas bankruptcy client called me on the phone, and she will save almost $700 by not having to pay the fee, because she filed bankruptcy here in Houston within the last 6 months.

To get the hardship exemption for bankruptcy, you have to fill out an application, attach a copy of your bankruptcy documents, send it in, and if approved, you will receive a "unique exemption certificate number" (ECN). You put your ECN on your tax return to claim the exemption.

Do you think this is fair? Do you think people with a hardship should be allowed a waiver of the Obamacare penalty or "individual responsibility payment" as it is called? Please leave your comments or questions below.

J Thomas Black
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Board Certified, Consumer Bankruptcy Law- Texas Board of Legal Specialization
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