State Health Insurance Penalty Calculator

States with Individual Mandates

Most people don't realize the federal health insurance penalty went away in 2019—but five states said "not so fast" and created their own. If you live in California, Massachusetts, New Jersey, Rhode Island, or Washington DC, you're still required to have coverage or you'll owe a penalty on your state taxes. It's basically these states' way of keeping more people insured after the federal government dropped the requirement.

How State Penalties Are Calculated

The formula is pretty similar across all five states: you pay whichever is higher—2.5% of your household income above the tax filing threshold, or a flat fee per person. That flat fee runs around $800-900 per adult and $400-450 per kid in 2025, though exact amounts vary by state. And it's prorated, so if you were uninsured for half the year, you'd pay half the penalty. Not fun, but at least it's not the full year's worth.

Common Exemptions

You may be exempt from state penalties if:

• Your household income is below the state tax filing threshold
• The lowest-cost plan exceeds 8-9% of your household income (varies by state)
• You have a coverage gap of less than 3 consecutive months
• You qualify for a religious, hardship, or other exemption
• You're incarcerated or not lawfully present in the U.S.

Getting Affordable Coverage

Here's the thing: in most of these states, getting coverage through the marketplace with subsidies costs less than paying the penalty. The income-based assistance can bring premiums way down, and you might even qualify for Medicaid depending on your income. Before you resign yourself to paying a penalty, check what's actually available—you might be surprised at how affordable a plan can be.