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My wife and I are both U.S. citizens and plan on quitting our jobs and taking a year long trip around the world starting in September. That means we'd be without ACA health insurance for 4 month in 2016.

According to the IRS (https://www.irs.gov/affordable-care-act/individuals-and-families/questions-and-answers-on-the-individual-shared-responsibility-provision) if you travel abroad for more than 330 days it should be fine:

However, U.S. citizens who are physically present in a foreign country or countries for at least 330 full days during any period of 12-consecutive months are exempt from the individual shared responsibility payment for any month in the tax year that is included in that 12-month period.

Though when I have to file taxes for 2016 we'll be in the middle of those 330 days. Does anybody know how that'll work? Will I have to pay the penalty for 2016? Will I get that back in 2017 or just have to eat it? Is there some way of saying that we're currently abroad and plan on staying for >330 days?

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  • I'm voting to close this question as off-topic because this question is about US tax system
    – Aleks G
    Commented Jun 30, 2016 at 20:02
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    I'm voting to leave this question open as it is about a travel-related tax issue of American citizens.
    – mts
    Commented Jun 30, 2016 at 22:35
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    @mts I'm voting to close it because it's about the tax implications of leaving the USA for a long time. The question is entirely about tax and doesn't depend at all on the details of the travel, except that it's outside the US. We have Personal Finance & Money for questions about tax and Expatriates for questions about long-term travel. Commented Jul 1, 2016 at 11:09
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    @mts I don't feel too strongly about the long-term travel versus expats question, though it might be worth raising on meta, if it hasn't been already. Commented Jul 1, 2016 at 11:49

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I do not know how this works for ACA, but I do know how it works for the earned income exemption, and I am going to guess the rule is the same. The IRS recommended getting an extension to file, paying what you think you owe (if any) with that form, due April 15. There is now a special Form 2350 for exactly this case, and you choose an extension date that works for the 330-day rule.

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  • That'd work. Extend until October so we'll be over 330 by then. We're due for a refund anyways I think.
    – GapYear
    Commented Jun 30, 2016 at 18:19

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