Instructions For Form 8965 - Health Coverage Exemptions

Affordability Worksheet

Use this worksheet to determine whether coverage for each individual in your tax household is considered unaffordable. If you or an-

other member of your tax household isn't eligible for employer-sponsored coverage, use the

Marketplace Coverage Affordability

Worksheet

to figure the required contribution for that individual. An individual is eligible for the affordability exemption for any month in

which (B), the Required Contribution, is more than (A), the Affordability Threshold. To claim this coverage exemption, enter code “A” in

Part III, column (c), and identify the months to which the exemption applies as described under

Columns (d) - (p)—Calendar

Months,

later.

(A) Affordability Threshold

Enter 8.16% of your household income (see

Household

income). For this purpose, increase household

income by the amount of any premium that is paid through a salary reduction arrangement and excluded

from gross income.

(B) Required Contribution Amount

For each member of your tax household, enter in the columns provided the amount the individual must pay for coverage for the first situation

below that applies to that person. If the required contribution is the same for the whole year, enter the annual required contribution in the space for

each month. If the required contribution covers only part of the year, use the

Annualized Required Contribution Worksheet

to determine what the

annualized required contribution would be for each month. Once you have figured the annualized required contribution, enter it in the space for

each month.

Situations (use the first that applies to each member of your tax household, including you, for each month):

1. The lowest cost self-only policy offered to each member of your tax household by his or her

employer.

2. The lowest cost family policy* offered by your employer or your spouse's employer (if you are filing a

joint return).

3. The amount from the Marketplace Coverage Affordability Worksheet.

For each individual, coverage is considered unaffordable and the individual is exempt for any month in which (B), the Required Contribution

Amount, is more than (A), the Affordability Threshold.

Members of your

tax household

(enter one name

per column):

Annualized required contribution for:

January

February

March

April

May

June

July

August

September

October

November

December

*The policy must cover everyone in your tax household:

For whom a personal exemption deduction is claimed on your tax return,

Who isn't eligible for other employer coverage, and

Who doesn't qualify for another coverage exemption.

Example 2—Unmarried individual with no dependents

eligible for the premium tax credit. The maximum premium tax

and no offer of employer coverage. Anna is unmarried and

credit that she could claim if she had enrolled in the lowest cost

has no dependents. Her household income is $15,000. She

bronze plan is -0-. Anna can claim the exemption for unafforda-

can't enroll in employer coverage for any month in 2017. The an-

ble coverage for 2017 because her required contribution is

nual premium for the lowest cost bronze self-only plan in Anna's

$5,000, which is more than 8.16% of her household income

rating area is $5,000. She was eligible for Medicaid, so she isn’t

($1,224, which is $15,000 multiplied by 0.0816).

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Instructions For Form 8965 - Health Coverage Exemptions - 2016 Page 10

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