Good News For Aaron Hernandez -- He Will Avoid Individual Mandate Penalty
Lyndsey Barnett
Beginning in January, almost all individuals are required to carry health insurance or they will be subject to the individual mandate penalty. Yesterday, the IRS released final regulations on the penalty, which in 2014 is the greater of $95 or 1% of an individual’s adjusted gross income (think last line of page 1 of your 1040). The most significant item found in the regulations was the effective date. Although there has been much speculation that the individual mandate effective date would get pushed when the employer mandate was delayed, the issuance of these regulations with a January 1, 2014 date confirms that the individual mandate is going into effect as scheduled.
So how does this relate to Aaron Hernandez? Since Hernandez was cut by the New England Patriots shortly after his arrest, I am making the assumption that he no longer has health insurance (and that he wasn’t offered COBRA due to his termination being for gross misconduct). If my assumptions are correct, this should mean that he would either have to obtain health insurance or pay the penalty come January. However, the final regulations provide several exceptions to the penalty, including for those who have incomes below the filing thresholds, who have short coverage gaps, who are not lawfully present in the US, who are members of Indian tribes or Amish, who cannot afford coverage or who are incarcerated. Assuming Hernandez’s trial will not have concluded by January (note - I am staying away from whether he did it or not – innocent until proven guilty on this blog), he will not be subject to the individual mandate penalty while in jail. Since he is no longer receiving paychecks from his $40 million contract, this may be the only good news Hernandez has received in the past few months.
Beginning in January, almost all individuals are required to carry health insurance or they will be subject to the individual mandate penalty. Yesterday, the IRS released final regulations on the penalty, which in 2014 is the greater of $95 or 1% of an individual’s adjusted gross income (think last line of page 1 of your 1040). The most significant item found in the regulations was the effective date. Although there has been much speculation that the individual mandate effective date would get pushed when the employer mandate was delayed, the issuance of these regulations with a January 1, 2014 date confirms that the individual mandate is going into effect as scheduled.
So how does this relate to Aaron Hernandez? Since Hernandez was cut by the New England Patriots shortly after his arrest, I am making the assumption that he no longer has health insurance (and that he wasn’t offered COBRA due to his termination being for gross misconduct). If my assumptions are correct, this should mean that he would either have to obtain health insurance or pay the penalty come January. However, the final regulations provide several exceptions to the penalty, including for those who have incomes below the filing thresholds, who have short coverage gaps, who are not lawfully present in the US, who are members of Indian tribes or Amish, who cannot afford coverage or who are incarcerated. Assuming Hernandez’s trial will not have concluded by January (note - I am staying away from whether he did it or not – innocent until proven guilty on this blog), he will not be subject to the individual mandate penalty while in jail. Since he is no longer receiving paychecks from his $40 million contract, this may be the only good news Hernandez has received in the past few months.
