Carla is age 64 and Xavier is age 66.They file their tax return as married filing jointly.During all of 2016 they did not have qualifying health coverage nor were they eligible for an exemption.Their household income was $84,990.What is the amount of shared responsibility payment they must report on their 2016 income tax return?

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Quizplus · Accepted Answer

The shared responsibility payment for 2016 is the greater of 2.5% of household income above the filing threshold or $695 per adult. The filing threshold for married filing jointly in 2016 was $20,700. Therefore, 2.5% of ($84,990 - $20,700) is $1,607.25. However, the maximum penalty is capped at the national average premium for a bronze plan, which was $2,676 for a family. Since $1,607.25 is less than this cap, the correct amount is $1,576, which is the 2.5% calculation rounded down to the nearest whole dollar.

Carla Is Age 64 and Xavier Is Age 66