Hardship Exemption Rules Gutted for 2018 Individual Mandate

On Sept. 12, 2018, the Centers for Medicare & Medicaid Services (CMS) provided guidance on claiming a hardship exemption from the individual mandate under the Affordable Care Act (ACA) for 2018. Individuals may claim a hardship exemption on their 2018 federal income tax return without:

• Obtaining a hardship exemption certification from the Exchange; or 

• Providing any explanation or documentation of the hardship. 

In past years, most individuals had to apply for the exemption and receive a certification from an Exchange to qualify.

This change applies to 2018 only. However, for all eligible years, individuals can still apply for hardship exemptions through the Exchange, and CMS will continue to process those as normal. No exemptions are required after 2018 because the individual mandate has been effectively repealed beginning in 2019.