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Is There a Penalty for Not Having Health Insurance in 2026? Not a Federal One, but Four States and DC Still Charge
Written and reviewed by Dick Tracy, licensed health insurance broker (NPN 20414610) · Published October 16, 2026
Quick answer No, not from the federal government: the federal penalty for not having health insurance has been $0 since tax year 2019, when the Tax Cuts and Jobs Act zeroed it out. But five places still charge their own penalty on the state tax return: California, New Jersey, Massachusetts, Rhode Island, and the District of Columbia. There the flat amount runs from $695 to $950 per adult per year (Massachusetts uses income brackets) and climbs with income, up to $4,908 for one person in New Jersey for tax year 2025. Vermont has a mandate with no penalty, reporting only. Everywhere else, including New York, nobody fines you, but a gap in coverage still costs money. I educate, you decide.
I'm Dick Tracy, a health insurance broker. I'm licensed in California, New Jersey, and Massachusetts (NPN 20414610), three of the 25 states I hold a license in, and I work with 80+ carriers. My office is in Buffalo, New York, and I work with clients by phone or Zoom. I am not licensed in Rhode Island, the District of Columbia, or Vermont, so those rows are facts only.
tax years 2019 and later
four states and DC
pays, tax year 2025
Sources: IRS, Individual Shared Responsibility Provision; healthinsurance.org, individual mandate; California Franchise Tax Board, Personal health care mandate.
Is there a federal penalty for not having health insurance in 2026?
No. The requirement is still printed in the law, but the amount is zero. Section 11081 of the Tax Cuts and Jobs Act, Public Law 115-97, signed December 22, 2017, amended section 5000A of the Internal Revenue Code: the 2.5 percent of income became "zero percent" and the $695 flat amount became "$0," for months beginning after December 31, 2018 (26 U.S. Code 5000A).
The IRS says the payment is reduced to zero, and for 2019 and later Forms 1040 and 1040-SR no longer have the full-year health care coverage or exempt box. HealthCare.gov says the fee no longer applies. The states were free to pass their own mandates. Five did with a penalty, one without.
Which states still have a health insurance penalty in 2026?
healthinsurance.org lists mandates with penalties in Massachusetts, New Jersey, the District of Columbia, California, and Rhode Island. I checked each against the state tax agency's own page or form. California and New Jersey have not published 2026 flat amounts, so their rows show tax year 2025.
| State and form | Flat amount per year | Or, if higher | Caps | Tax year |
|---|---|---|---|---|
| California, Form FTB 3853 | $950 per adult, $475 per child | 2.5% of gross income above the filing threshold | $2,850 flat per household; bronze cap $377 per person per month | 2025 (FTB) |
| New Jersey, Schedule NJ-HCC | $695 per adult, $347.50 per child | 2.5% of household income above the filing threshold ($10,000 single, $20,000 joint) | $2,085 flat per household; bronze cap $4,908 for one person, $24,540 for a family of five | 2025 (NJ Treasury) |
| Massachusetts, Schedule HC | $312 to $2,532 per adult ($26 to $211 a month) by income bracket; $0 at or below 150% of the poverty level | Bracket schedule, no percentage | Half the lowest premium you would have qualified for through the Health Connector | 2026 (DOR TIR 26-1) |
| Rhode Island, Form RI-1040 line 12b, Form IND-HEALTH | $695 per adult ($57.92 a month), $347.50 per child | 2.5% of modified adjusted gross income above the filing threshold | $2,085 flat; bronze cap $357 a month ($4,284 a year for one person) | 2025 (RI Division of Taxation) |
| District of Columbia, Schedule HSR on Form D-40 | $795 per adult, half that for a child under 18 | 2.5% of federal adjusted gross income above the DC filing threshold | $2,385 flat; bronze cap about $375 a month ($4,494 a year for one person) | 2025 (OTR D-40 booklet) |
| Vermont, Form IN-111 | None | None | None; reporting only | 2025 (Vermont IN-111 instructions) |
Sources as linked in each row, all read October 16, 2026. DC counts a child under 18 as one-half of a person on Worksheet A of Schedule HSR.
Rhode Island, DC, and Vermont: facts only. I am not licensed in any of the three, so I cannot write coverage there or advise you on your return; take these to a tax professional in your state. Rhode Island's penalty dates from tax year 2020 under R.I. Gen. Laws section 44-30-101 (Division of Taxation 2025 instructions). DC's $795 figure for tax year 2025 is confirmed in the Office of Tax and Revenue's October 1, 2025 notice. Vermont's Act 63 of 2019 requires every filer to report coverage, and Vermont Health Connect says you do not have to pay a fine if you do not have coverage.
How much is the penalty in California, New Jersey, and Massachusetts?
The three penalty states I am licensed in, short version. California and New Jersey each have a full page on this site.
California. $950 per adult and $475 per child for tax year 2025, or 2.5% of gross income above the filing threshold, whichever is higher. The child amount was corrected from $450 to $475 in the FTB's Tax News Flash of March 6, 2026. Details on my California health insurance penalty 2026 page.
New Jersey. The Treasury's range for tax year 2025 is $695 to $4,908 for one person and up to $24,540 for a family of five: $695 per adult and $347.50 per child, capped at $2,085 per household on Worksheet L of the 2025 NJ-1040 instructions, or 2.5% of household income above the filing threshold, whichever is higher. No 2026 range is published yet. Details on my New Jersey health insurance penalty 2026 page.
Massachusetts. The oldest mandate in the country (2006) and the only one whose tax agency has published 2026 penalty amounts. The Department of Revenue sets them by income bracket, as a share of the federal poverty level, in TIR 26-1, dated March 23, 2026.
| Individual income, as a share of the federal poverty level | Penalty per month | Penalty for a full year |
|---|---|---|
| 150% or less | $0 | $0 |
| 150.1% to 200% | $26 | $312 |
| 200.1% to 250% | $51 | $612 |
| 250.1% to 300% | $76 | $912 |
| 300.1% to 400% | $117 | $1,404 |
| Above 400% | $211 | $2,532 |
Source: Massachusetts Department of Revenue, TIR 26-1, using the 2025 federal poverty level standards. No penalty for a lapse of 63 consecutive days or less. More on my Massachusetts self-employed page.
What counts as coverage that avoids a state penalty?
California, New Jersey, Rhode Island, and the District of Columbia all use the federal term, minimum essential coverage: an employer plan in the small or large group market, an individual major medical plan bought on or off the exchange, COBRA, Medicare Part A, Medicaid, CHIP, TRICARE, and VA care. New Jersey's Treasury list spells out group coverage and, in its words, a self-insured health plan for employees; Rhode Island's instructions name an "eligible employer-sponsored plan." Massachusetts uses its own yardstick, Minimum Creditable Coverage, which its Schedule HC instructions say is not the same as the federal term, reported by your insurer on Form MA 1099-HC.
What does not count anywhere: "excepted benefits" only, such as stand-alone dental or vision, a specified-disease policy, or a discount card. Accident and fixed indemnity plans are not on any state's list either; I use them as a second layer on a real plan, never the only coverage. Foundation, not a roof.
Now the plan I use most for healthy self-employed people: the pre-established ERISA group plan, the cheat code. Group plans already exist under ERISA, the 1974 federal benefits law, and a solo owner can be merged into one: group rates, a true PPO network, a policy you own, no employees required. In New Jersey, Rhode Island, and DC the question is whether it is group coverage; in Massachusetts, whether it meets MCC. I confirm in writing before you sign how that specific plan is treated for your state's mandate, and that you will receive the tax form that proves it. Mechanics: the ERISA cheat code page.
The practical test I use with clients
Before you enroll in anything, get it in writing that the plan satisfies your state's coverage requirement and that you will receive the tax form for your file: a Form 1095, or a Form MA 1099-HC in Massachusetts. A real group plan or a real individual major medical plan can answer that in one sentence. If the answer is a paragraph, keep your wallet in your pocket.
The short gap rule and the exemptions the penalty states share
Every penalty state copied the shape of the old federal rules, so the exemptions rhyme. The gap rule is tighter than it sounds: "less than three months" means two months is fine and three is not, and at month three the penalty reaches back over the whole gap.
| State | Short gap that is exempt | Income floor | Unaffordable if the cheapest plan costs more than | Where you claim it |
|---|---|---|---|---|
| California | Three consecutive months or less | Income below the state filing threshold | 7.28% of household income (2025), 8.05% (2026) | Form FTB 3853 |
| New Jersey | Less than three months, first gap only (code B-1) | Not required to file, or income at or below 138% of the poverty level (code A-3) | 8.05% of household income (NJ's page gives no year; 8.05% is the federal 2026 figure) | Schedule NJ-HCC |
| Massachusetts | 63 consecutive days or less, read as three calendar months | At or below 150% of the poverty level | The Health Connector's affordability schedule for the year | Schedule HC |
| Rhode Island | Less than three consecutive months, first gap only (code B) | Not required to file (code NC) | 7.28% of household income | Form IND-HEALTH |
| District of Columbia | Less than three consecutive months (code B) | $34,743 or less for one member age 21 or older (code L) | Affordability certificate from DC Health Link (code A) | Schedule HSR |
Sources: FTB; NJ Treasury, Claim Exemptions; mass.gov, Health Care Reform for Individuals; RI 2025 Individual Mandate Instructions; DC 2025 D-40 booklet. All read October 16, 2026. Every state also exempts a recognized religious sect, sharing ministry members, tribal members, incarceration, living abroad, and hardships. A sharing ministry is not insurance and no claim is guaranteed; I do not write them.
No penalty in your state? One bad February still costs money
Forty-six states and the federal government fine you nothing for going without coverage (Vermont asks on the return, but fines nothing). That does not make it free. Three things no penalty table shows:
- You pay the billed charge, not the network rate. An insured patient's bill is repriced to the insurer's negotiated allowable; an uninsured patient gets the list price and negotiates alone. I will not promise you a number.
- There is no ceiling. A real plan has an out-of-pocket maximum. Going bare has none.
- You cannot buy back in on the day you need it. Individual major medical plans sell during open enrollment or a special enrollment period. HealthCare.gov gives 60 days after an involuntary loss of coverage, and voluntarily dropping COBRA does not count.
That is the "one bad February" problem. The penalty, where it exists, is the small number; the February is the big one. And paying the penalty buys nothing: a California adult hands the FTB $950 and still has no coverage.
Which situation are you in?
Healthy, self-employed or a small business owner in California, New Jersey, or Massachusetts, income too high for a subsidy
Look at the pre-established ERISA group plan first. Before you sign I confirm in writing how the plan is treated for your state's mandate. Start with the best health insurance for self-employed people.
Income under the subsidy lines
A subsidized marketplace plan or Medicaid may be your best deal, and I will tell you so. The trade-offs: narrower networks, an income estimate you must get right, and paying credits back if you guess low. The knockouts are on my who is not eligible for the premium tax credit in 2026 page.
Between jobs or between clients
Watch the calendar, not the penalty. In the penalty states you have roughly two months of grace, and everywhere you have 60 days after an involuntary loss to use a special enrollment period. COBRA counts as coverage.
A serious diagnosis in the last five years
Guaranteed-issue coverage, for now. Individual plans cannot ask health questions, on or off the exchange. Take that protection, get well, and we revisit the other doors later.
One of the 46 states with no penalty, New York included
Nobody fines you. The question is what kind of tank we should build so one bad month does not take the business down.
Common questions about the health insurance penalty in 2026
Is there a penalty for not having health insurance in 2026?
Not from the federal government. The Tax Cuts and Jobs Act set the federal payment to $0 for months after December 31, 2018, and the IRS says Forms 1040 and 1040-SR for 2019 and later no longer carry the coverage box. Five places still charge a penalty on the state return: California, New Jersey, Massachusetts, Rhode Island, and the District of Columbia. Everywhere else, including New York, there is no penalty.
How much is the penalty for not having medical insurance?
It depends on the state. California: $950 per adult and $475 per child for tax year 2025, per the Franchise Tax Board. New Jersey: $695 to $4,908 for one person for tax year 2025, per the New Jersey Treasury. Massachusetts: $26 to $211 a month for tax year 2026, per Department of Revenue TIR 26-1. Rhode Island: $695 per adult, tax year 2025. District of Columbia: $795 per adult, tax year 2025. Federal: $0.
Does the IRS still ask about health insurance on your tax return?
No. The IRS says that for 2019 and later, Forms 1040 and 1040-SR do not have the full-year health care coverage or exempt box, and you do not report coverage or claim an exemption on the federal return. You will still receive a Form 1095-A, 1095-B, or 1095-C. Six returns still ask, five states and DC: California, New Jersey, Massachusetts, Rhode Island, Vermont, and the District of Columbia.
What is the Massachusetts health insurance penalty for 2026?
The Massachusetts Department of Revenue set the tax year 2026 penalties in TIR 26-1, dated March 23, 2026: $26 a month at 150.1% to 200% of the federal poverty level, $51 at 200.1% to 250%, $76 at 250.1% to 300%, $117 at 300.1% to 400%, and $211 above 400%, which is $2,532 a year. Nobody at or below 150% of the poverty level owes a penalty, and a lapse of 63 consecutive days or less is not penalized.
Does a group plan or an ERISA plan count as coverage for a state mandate?
In the states that use the federal definition of minimum essential coverage, yes. New Jersey's Treasury list names group coverage in the small or large group market and a self-insured health plan for employees; Rhode Island's and the District of Columbia's instructions name an eligible employer-sponsored plan. Massachusetts asks whether the plan meets its Minimum Creditable Coverage standard instead. Before you sign anything, I confirm in writing how that specific plan is treated for your state's mandate.
How long can you go without health insurance before a state penalty applies?
About three months, worded differently in each state. California exempts a gap of three consecutive months or less. New Jersey, Rhode Island, and the District of Columbia exempt a gap of less than three consecutive months, and New Jersey and Rhode Island allow only the first gap of the year. Massachusetts allows a lapse of 63 consecutive days or less, which the Health Connector reads as three calendar months.
Is there a penalty for not having health insurance in New York or another state without a mandate?
No. New York has no state individual mandate, and the federal penalty has been $0 since tax year 2019. That is true everywhere except California, New Jersey, Massachusetts, Rhode Island, and the District of Columbia, plus Vermont, which requires reporting only. No penalty is not the same as no cost: an uninsured person pays the billed charge instead of a network rate, and individual plans sell only during open enrollment or a special enrollment period.
Thirty minutes on the phone or Zoom, no fee, no hard sell. Bring your state, your age, a rough income number, and how you use care. In California, New Jersey, or Massachusetts, I put the doors that fit you side by side and show you in writing that what you pick satisfies your state's mandate. Anywhere else I am licensed, we skip the penalty talk and build the tank. I educate, you decide.
Grab a time right here
Pick a slot below and it lands on both our calendars. Phone or Zoom, plan documents on the screen, real numbers side by side. I educate, you decide.