Note: this guidance is now outdated. Please refer to this blog for current guidance.
On February 15, 2017, the IRS announced on its website that, based upon its review of the White House’s January 20, 2017, executive order, it would continue to accept returns filed by taxpayers that do not report whether the taxpayer has complied with the individual mandate of the Affordable Care Act. Individual taxpayers are required to report on their returns whether they have health insurance coverage, qualify for an exemption to the coverage requirement, or are making a shared responsibility payment. Previously, the IRS had made changes to its software that processes tax returns so that returns filed without these sections completed would be automatically rejected and treated as not filed. Now, those returns will be treated as filed, and the missing information will be addressed by the IRS.
The announcement does not mean that the IRS will no longer enforce the Affordable Care Act’s individual mandate provisions, although headlines in the popular media may suggest otherwise (for example, “IRS no longer enforcing Obamacare individual mandate, report says.”). The IRS announcement states that “legislative provisions of the ACA law are still in force until changed by Congress, and taxpayers remain required to follow the law and pay what they may owe.”
For the moment, the change means that the IRS will continue processing returns that do not complete these sections; a taxpayer who does not complete the provisions related to the Affordable Care Act may receive requests for more information and, ultimately, penalty notices, for the failure to provide required information.