individual shared-responsibility payment
DEFINITION: Almost all Americans are required to have health insurance starting in 2014. Some people are eligible for an exemption from this requirement, but anyone else who goes without insurance starting in 2014 will be assessed a penalty based on the number of months without health insurance. (One gap of up to three months is allowed with no penalty.)
The penalty starts in 2014 at $95 per uninsured adult ($47.50 per child) up to $285, OR 1 percent of taxable household income, whichever is greater. By 2016, the penalty increases to $695 per adult ($347.50 per child) up to $2,085, OR 2.5 percent of taxable household income, whichever is greater. The percentage of income penalty is always capped at the national average cost of a bronze plan.