As many as 6 million people could face fines of up to 1% of their household income for not having health insurance in 2014, Mark Mazur, assistant secretary for tax policy at the U.S. Treasury Department, said Wednesday.
The penalty, as outlined in the Patient Protection and Affordable Care Act, is tied to the individual mandate.
Roughly 10% to 20% of the 150 million taxpayers expected to file returns by April 15 were uninsured for all or part of 2014 and will claim an exemption from the requirement to have coverage.
But another group of taxpayers, 2% to 4%, will pay a penalty because they did not obtain coverage they could have afforded and they do not qualify for an exemption, Mazur said during a joint news call with senior HHS officials.
Three to 5% of taxpayers benefited from advance payments of tax credits to help lower the cost of their 2014 marketplace premiums. Given the various rollout woes of HealthCare.gov, the IRS announced Monday that consumers who find out they received too much financial assistance after not accurately projecting their income can apply for a waiver to be relieved of any financial penalty (PDF). The waiver will be offered only for the 2014 tax year.
Last year, 6.7 million people selected and paid for plans in the state and federal exchanges.
HHS officials are reaching out to exchange-plan-insured individuals about how to fill out the 1095-A tax forms the administration began sending out this month.
The new tax document lists who in each household received subsidized coverage and how much the government paid each month to help with premiums. Taxpayers are supposed to use this information to fill out Form 8962, which will be used to determine whether people received more or less assistance than they were entitled to.
In addition to e-mail, texts and mailers, HHS has teamed up with a number of not-for-profit organizations and some of the nation's largest tax preparers to get the word out. Partners include tax preparation companies H&R Block, Jackson Hewitt and TurboTax.
“Every year, non-profit organizations and tax preparers provide millions of Americans the assistance they need to file their returns and we are pleased to collaborate with them,” HHS Secretary Sylvia Burwell said in a statement.
During the call Wednesday, officials repeatedly declined to comment on whether HHS would allow a special enrollment period for people who realize after the Feb. 15 deadline that they will face a serious tax penalty for not obtaining coverage.
For 2015, the penalty for not obtaining coverage is $325 per uninsured person or 2% of household income.
Follow Virgil Dickson on Twitter: @MHvdickson