Tax professionals Health care mandate

Here’s more information about the state healthcare mandate that may interest tax professionals.

Health care forms

• Premium Assistance Subsidy (FTB 3849) (obsolete after 2021)
• Health Coverage Exemptions and Individual Shared Responsibility Penalty (FTB 3853)
• California Health Care Insurance Marketplace Statement (FTB 3895)

Outreach to the public

We’ve partnered with Covered California to ensure the public is aware of the HCM. Covered California has been running TV and radio ads urging people to get coverage and take advantage of federal financial assistance.

Subsidies

How they work

Covered California will administer health care subsidies. Taxpayers who obtain health insurance from Covered California may qualify based on their projected annual income. Subsidies are received in the form of reduced cost of monthly premiums. If a taxpayer’s employer is offering health coverage, the taxpayer may not be eligible for subsidies.

Penalties

California residents who do not have coverage for themselves and their dependents for each month in 2023, and who do not meet an exemption, will pay a penalty of $900 per adult or more and $450 per dependent child, or 2.5% of their or gross income over the filing threshold for their filing status, whichever is higher. The penalty for a married couple without coverage can be $1,800 or more, and the penalty for a family of four with two dependent children could be $2,700 or more.

Gap coverage

A short gap coverage exemption will apply for taxpayers who did not have coverage for three consecutive months or less. (Note to meet the federal short gap coverage exemption the gap coverage must be less than three consecutive months.)

Check the box

If the taxpayer, the taxpayer’s spouse or domestic partner, and the taxpayer’s dependents had qualifying health care coverage for each month of 2023 or Medicare Part A or C coverage, then make sure to check the “Full-year health care coverage box,” line 92, on the return.