Amended by section 10106 of the Senate Manager’s Amendment and 1002 of HCERA. Effective January 1, 2014, mandates that all individuals with access to affordable coverage purchase minimum essential coverage or pay a penalty. The penalty phases up as follows:
- 2014: $95 or 1% of income (whichever is greater)
- 2015: $325 or 2% of income
- 2016: $695 or 2.5% of income (up to a cap of the premium for a Bronze plan)
- After 2016: caps adjusted by increases in cost of living
Exceptions are made for individuals not lawfully present in the U.S., religious objectors and incarcerated individuals. Additional exemptions are allowed for taxpayers with income below the filing threshold, members of Indian tribes, those granted a hardship waiver and individuals who were not covered for less than three months of the year.