The CP14H is a balance due notice for the Affordable Care Act's individual shared responsibility payment. This is the penalty for not having qualifying health insurance coverage. The Tax Cuts and Jobs Act reduced the individual mandate penalty to $0 starting in 2019, so this notice only applies to tax years 2018 and earlier.
Why You're Getting This Now
If you're receiving a CP14H for a pre-2019 tax year, it's likely because the IRS recently assessed the penalty after processing a late return, after an adjustment, or after a prior notice went unresolved. The penalty may have been assessed through a math error correction or after the IRS determined you didn't have qualifying coverage and didn't qualify for an exemption.
The Penalty Amount
For 2018 (the last year the penalty applied), the penalty was the greater of $695 per adult (plus $347.50 per child, up to $2,085 for a family) or 2.5% of household income above the filing threshold. The IRS assessed whichever calculation produced the higher amount.
Exemptions
Several exemptions existed that could reduce or eliminate the penalty. These included coverage gaps of less than three months, income below the filing threshold, membership in a recognized health care sharing ministry, hardship exemptions, and coverage through Medicaid, Medicare, employer plans, or marketplace plans.
If you qualified for an exemption but didn't claim it on your return, you may be able to file an amended return to eliminate the penalty.
Going Forward
Since the individual mandate penalty is $0 for 2019 and later, new CP14H notices should not be issued for current tax years. However, some states (California, Massachusetts, New Jersey, Rhode Island, Vermont, and the District of Columbia) have their own individual mandates with state-level penalties. The CP14H only applies to the federal penalty.
If you've received a CP14H and believe you qualified for an exemption, call us at (813) 229-7100.