Help with annual income Health care penalty estimator

When to calculate

You will need to calculate your annual household income if any of the following apply:

  • Your annual household income is below the filing threshold. You plan on checking the “Full-year health care coverage or exempt” box on Form 540
  • You could not afford health coverage. You plan to claim an exemption for health care coverage that is considered unaffordable
  • You want to estimate your penalty

What counts as annual household income

Your household for the penalty includes:

  • You
  • Your spouse or registered domestic partner (RDP)
  • Your dependents

The penalty estimator uses an income number called modified adjusted gross income (MAGI). MAGI is not a line on your tax return.

Generally, for each member of your household who is required to file a tax return, it is the total of the following:

  • Your adjusted gross income (AGI) on your state tax return
  • Excluded foreign income
  • Tax-exempt interest

Dependent income

If your dependent is required to file a state tax return, include their income from things like a:

  • Summer job
  • Work-study
  • Limited part-time work