You're now part of the ever growing army of self-employed.
It goes by many names whether it's contract, 1099, schedule C, independent worker...
There are some big advantages to being self-employed for both taxes and health insurance.
We'll talk about the latter here and discuss how taxes now figures into the picture.
We know you're busy.
Being your own boss is...well...busy!
The Sharing economy has changed everything!
Health insurance is along for the ride.
Let's look under the hood.
First, Obamacare is the coloquial term for the Affordable Care Act (ACA for short).
It's the law that changed health insurance significantly.
Especially for the individual/family market.
Many people get health insurance from an employer (group health).
Self-employed people do not have this option.
They are the employer now!
Let's take the major pieces of Obamacare and explain how they affect the self-employed out there!
A recent study indicated that 40% of Americans may derive their income from the new "Gig Economy" by 2020.
That's a huge shift.
All those people will need to get their own health insurance.
Yes, they want to protect themselves from the big catastrophic bills (and occasional weekend sports injury) but also to avoid the penalty.
If you do not have health insurance now, there is a penalty as follows:
That was part of the Obamacare law so that people will enroll.
If everyone just got coverage when they were sick, the market would explode.
It's a basic tenant of insurance.
So that's the stick.
Taxes are already complicated enough.
Who wants a $1000 bill attached; payable to the IRS.
That's no way to run your new business so get out ahead of this.
The way forward is to get an ACA compliant health plan.
Be careful...the various short term plans and questionable plans out there will still leave you with a penalty.
It has to be an ACA plan.
You can run a full list of the ACA plans available here or call us at 800-320-6269:
There's no cost for our services as licensed Health Insurance Agents.
The Obamacare law wasn't all bad cop.
Hello, Mr Good Cop!
The law also wanted to provide a carrot to enroll.
It turns out the carrot is even better for self-employed people.
First, a quick lay of the tax credit landscape.
Being self-employed...especially being new at it can be tough on cash flow.
No need to wait for April.
The tax credit is based primarily on household income.
Here's where being self-employed gets preferential treatment:
The amount of tax credit is based on income. Roughly line 37 on the 1040 for most people.
That's the Adjusted Gross Income. They back in a few other things: Foreign income, tax free interest, and Social Security.
These don't apply to most self-employed people so line 37 is a good estimate.
We're looking at the current year so prior year income is not a concern.
This can be important for people transitioning to self-employment or 1099 this year.
Why is line 37 so good for self-employed?
That means your business deductions come off the number.
That can be a huge deal.
Secondly, if you look right above line 37, you'll see some other deductions.
The bigger ones apply to the self-employed.
That's a big subtraction right there!
Half of the self-employment tax also shows as a deduction.
More good good news for 1099 contract workers.
There are other deductions to look at such as tuition fees, moving expenses, and student loan interest.
The lower your Adjusted Gross income (line 37), the more tax credit you may be eligible for.
What's the easiest way to find out?
You can either run your quote here or call us at 800-320-6269:
How else do the Obamacare law help self employed?
Just keep reading!!
There were always big differences between Employer based coverage and Individual Family.
The ACA law basically brought most if not all of the protections from the group market to the self-employed.
Now with ACA plans, you can have the following protections:
Basically, many of the carve-outs that used to exist are gone.
This was always an issue.
A person wanted to go off on their own and start a business but were afraid to leave their group health plan.
They might be declined due to health. They might be rated up due to health. There could be waiting periods.
The trade-off for these protections are rules about how and when to enroll.
More on that now!
There are now year-end Open Enrollment windows during which we want to apply.
The window generally runs Nov 1st - Jan 31st but check with us as it can change year to year.
During this time, everyone can enroll and/or change plans.
What if we're outside the Enrollment period?
We need a Special Enrollment trigger:
Those are the most common.
If you're going contract or self-employed and losing group health coverage, call us right away.
Call us at 800-320-6269 or run your gig economy quote here. Our services are 100% free to you.
If you can't enroll right away (no qualifying event), you may need to get Short term health insurance to fill the gap here.
And oh yes....we wish your business all the success in the world!
"My sincere thanks for making a miracle happen- 2014 health insurance !! Many thanks for your expertise and advice yesterday !!"
"Thanks again for your help - I had absolutely no idea how to get this done when I got up this morning. You've made it remarkably easier than I expected. I hope you're not stuck at the office all night..."
"Anyway, I hope you got some time off this past week! Thank you again for your help and efforts on my behalf! I was very lucky to find you."
"I thank you very much for the time that you have invested in handling everything
"I truly appreciate the quick response and will think of you in the future if I need to make any changes to my insurance plans."
"You are awesome... takes a huge worry off my back, thank you for your kind. thanks for your time and kindness. !!"
"Wow, I can't thank you guys enough for your help...I couldn't imagine trying to tackle this on my own!"
"You are my new best friend. A HUGE thank you again.
20 years of experience in the California health insurance market has taught us one thing...Competent and experienced guidance is Invaluable
We can quickly (very important) size up your health insurance needs and clearly explain the options available to you. Our focus is finding the most coverage at the best cost to you.
We are licensed Covered Ca agents with in-depth knowledge of their plans, process, and tax credits.
Call us...you will be Pleasantly Surprised. 800-320-6269
We'll quickly see if you have the best priced plan available and if you qualify for a tax credit800-320-6269
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