Is There Still a Penalty for Not Having Health Insurance?

Why the federal penalty disappeared

The Affordable Care Act's original individual mandate required most Americans to maintain qualifying health coverage or pay a tax penalty, designed to keep healthier people in the insurance pool so premiums stayed manageable for everyone. The 2017 Tax Cuts and Jobs Act reduced that federal penalty to $0, effective for the 2019 tax year onward — technically the mandate still exists in the law, but with no dollar amount attached, there's nothing to actually pay, and no health coverage question on your federal Form 1040 anymore.

This change is nationwide and hasn't been reversed since. If you've filed federal taxes anytime from 2019 forward without a health insurance question, that's exactly why — it isn't an oversight or a form you're missing, the requirement simply carries no consequence at the federal level.

It's worth understanding why this specific mechanism, zeroing out the dollar amount rather than repealing the mandate outright, was chosen. Fully repealing the individual mandate provision would have required a more complex legislative process than the budget reconciliation bill used to pass the Tax Cuts and Jobs Act allowed. Reducing the penalty to $0 achieved the same practical effect for taxpayers without needing that separate legislative step, which is also why the underlying mandate language technically remains on the books even though it carries no real consequence today.

Which states still enforce a penalty

In response to the federal penalty dropping to zero, a handful of states decided to keep their own version alive, reasoning that a penalty helps keep enough healthy people enrolled to hold down premiums in their own ACA Marketplace. As of 2026, that list is:

If you don't live in one of these five states or D.C., there is currently no penalty — federal or state — for going without health insurance. Moving between these jurisdictions during the year can also matter, since some of these penalties are prorated by the number of months you lacked coverage while a resident.

It's worth noting that this list has shifted before and could shift again. Several of these states didn't have their own mandate at all until 2019 or 2020, choosing to act specifically because the federal penalty had just dropped to zero. Other states have discussed similar legislation without ultimately passing it, and it's reasonable to expect this list to be revisited periodically as state legislatures respond to enrollment trends and marketplace premium pressures in their own state. Checking this list again before each year's tax filing season, rather than assuming it's permanently fixed, is a reasonable habit if you live in or move between any of these jurisdictions.

How most of these penalties are calculated

California, New Jersey, Rhode Island, and D.C. all use a similar structure: you owe whichever is greater — a flat fee per adult and per child, or 2.5% of household income above your state's tax filing threshold. Flat-fee amounts and income thresholds are adjusted for inflation each year by each state's own tax authority, so exact dollar figures shift annually and are worth confirming directly on your state's site rather than relying on a number that may already be a year or two stale by the time you read it.

As a general sense of scale, recent flat-fee estimates across these four jurisdictions have clustered in the range of roughly $700 to $950 per uninsured adult and roughly half that per uninsured child, with an overall household cap tied to the average cost of a Bronze-tier plan in that state. Households with higher income are more likely to hit the 2.5%-of-income calculation instead of the flat fee, since that formula scales upward with earnings while the flat fee doesn't.

One detail that trips people up: the penalty is typically prorated by the number of months you lacked coverage, not charged as a flat annual amount regardless of timing. Someone uninsured for two months out of the year generally owes a fraction of the full annual penalty, not the entire amount — though the exact proration method varies by state, and short gaps of a month or less sometimes qualify for a specific exemption instead of triggering any prorated charge at all.

Massachusetts: a different formula entirely

Massachusetts doesn't use the flat-fee-or-percentage structure the other states share — it's been running its own mandate since 2006, predating the ACA itself, and calculates the penalty on a monthly sliding scale based on your age and income, assessed for each month you lacked qualifying coverage rather than as a single annual figure. The state also requires your coverage to meet its own Minimum Creditable Coverage standard — a plan that satisfies another state's requirement, or even a federal standard, doesn't automatically count in Massachusetts unless it meets this specific bar.

Massachusetts residents report their coverage status on Schedule HC with their state tax return, and the state's health insurance authority, the Massachusetts Health Connector, publishes the current year's exact monthly penalty tiers directly — worth checking there rather than relying on a flat estimate, given how much this structure differs from the other mandate states.

Vermont: a mandate with no penalty

Vermont is worth calling out specifically because it sits in an unusual middle ground: state law technically requires residents to maintain health coverage and report their status, but the legislature never attached a financial penalty to noncompliance. In practice, this means Vermont residents fill out a reporting requirement without facing an actual fine if they go uninsured — a distinction that matters if you've seen Vermont listed alongside the five penalty states and assumed the rules were identical.

Exemptions available in these states

Every mandate state offers exemptions similar in spirit to the ones that existed under the original federal mandate. Common categories include an affordability exemption (the cheapest available plan would exceed a set percentage of your income), a hardship exemption (specific financial or personal circumstances made obtaining coverage impractical), a short coverage gap exemption (typically covering a gap of a few consecutive months or less), and a religious conscience exemption in some states. Each state administers its own exemption application separately from the others, so an exemption granted in one state doesn't automatically transfer if you move to another mandate state mid-year.

It's also worth understanding that claiming an exemption isn't automatic just because you believe you qualify — most states require you to actually apply for and receive approval of the exemption, either through the state's marketplace or directly with your tax filing, before it protects you from the penalty. Waiting until you're already filing your return to discover you needed to apply earlier in the year is a common, avoidable mistake, particularly for the hardship and affordability categories, which sometimes have their own specific application deadlines separate from the general tax filing deadline.

What to actually do next

If you live in California, Massachusetts, New Jersey, Rhode Island, or D.C. and are currently uninsured, the most direct next step is comparing individual health insurance or family coverage options before your state's enrollment window closes for the year, since avoiding the penalty going forward requires actual coverage, not just awareness of the rule. If you're between jobs or in a temporary gap, our guide on health insurance when changing jobs covers how to avoid a coverage gap that could trigger one of these state penalties in the first place.

If you live anywhere else in the country, there's currently no federal or state penalty for being uninsured — but that doesn't mean going without coverage is risk-free, since a single serious illness or accident without insurance can still cost far more than any penalty ever would.

Common questions about the health insurance penalty

Have a question that isn't answered below? Our full health insurance FAQ page covers more, and our blog has deeper guides on ACA coverage and enrollment.