California Individual Health Insurance Mandate and Penalty

If you live in California and go without health coverage, the state charges a penalty on your income tax return. For the 2025 tax year, the California health insurance penalty is at least $950 per uninsured adult and $475 per uninsured child, or 2.5% of the household income above the state filing threshold, whichever comes out higher. The total is capped at the annual cost of an average bronze-level plan for your household size.¹

How the Penalty Is Calculated

California Revenue and Taxation Code Section 61015 sets out a three-step calculation. Skip any step and the number you land on will be wrong.²

Step One: Take the Greater of Two Amounts

The Franchise Tax Board runs two calculations and uses the larger figure.

Flat-dollar amount: $950 for each uninsured adult and $475 for each uninsured child under 18, capped at $2,850 per household (300% of the per-adult amount) no matter how many people are uninsured.¹
Income-based amount: 2.5% of household income above the California filing threshold for your filing status.²

For 2025, the filing threshold is $22,941 for a single filer under 65 with no dependents and $45,887 for a married couple filing jointly (both under 65, no dependents).³

Step Two: Apply the Bronze Plan Cap

The penalty cannot exceed the annual cost of the state average bronze-level plan for your household size. For 2025, the monthly bronze average is $377 per person, and the annual caps are:

1 person: $4,524
2 people: $9,048
3 people: $13,572
4 people: $18,096
5 or more: $22,620

You owe the lesser of the Step One number or this cap.⁴

Step Three: Prorate for Partial-Year Gaps

The penalty is monthly. Miss four months of coverage, owe one-third of the annual amount.²

Worked Examples

A single adult earning $60,000 with no coverage all year: the flat amount is $950; 2.5% of ($60,000 − $22,941) is about $927. The flat amount wins, so the penalty is $950. That’s far below the $4,524 bronze cap.

A single adult earning $150,000: the income-based figure is about $3,177, well above the $950 flat amount. It still sits under the $4,524 bronze cap, so the penalty is $3,177.

A family of four with no coverage all year: the flat amount tops out at $2,850, but the income-based number can go higher depending on earnings. The $18,096 bronze cap sets the absolute ceiling.

Who Has to Have Coverage

Anyone treated as a California resident for tax purposes owes the mandate. You’re a resident if you’re in the state for anything more than a temporary or transitory reason, and the FTB presumes residency if you spend more than nine months of the year in California.⁵

The requirement covers everyone on your return. A spouse or registered domestic partner on a joint return needs coverage, and so does every dependent, including children. A single month without coverage for any household member can trigger a penalty.¹

What Counts as Qualifying Coverage

Your plan has to meet the federal “minimum essential coverage” standard that California adopted. Most familiar forms of insurance qualify:

Employer-sponsored group plans, whether fully insured or self-funded.
Individual and family plans, including anything purchased through Covered California.
Government programs: Medicare Part A or Part C, Medi-Cal, CHIP, TRICARE, and VA health benefits.
Grandfathered plans that predate the Affordable Care Act.

Some products that look like health insurance do not qualify. Short-term limited-duration insurance, dental-only or vision-only plans, and restricted-scope Medi-Cal don’t meet the standard.⁶ Your insurer sends a Form 1095-B or 1095-C confirming whether your plan qualifies.

Exemptions That Erase the Penalty

California recognizes a wide list of exemptions. Some you claim directly on your return; others require a certificate from Covered California before you file.¹

Claimed Directly on Form 3853

Income below the California filing threshold.
Unaffordable coverage: the cheapest available plan would cost more than 7.28% of household income for 2025.
Short coverage gap: a lapse of three consecutive months or less.
Membership in a qualifying health care sharing ministry.
Membership in a federally recognized tribe or shareholder status under the Alaska Native Claims Settlement Act.
Incarceration after disposition of charges, for the months confined.
Months before a child was born or adopted, or months after a household member’s death.
Non-citizens not lawfully present, and residents of another state or U.S. territory.
Enrollment in restricted-scope Medi-Cal or similar limited coverage.

Requires Covered California Approval First

Religious conscience, based on membership in a recognized sect with established beliefs opposing medical benefits.
Affordability hardship, where Covered California reviews projected income and confirms you lack access to affordable coverage.
General hardship: homelessness, eviction, domestic violence, bankruptcy, a death in the family, a natural disaster that damaged property, or unpayable medical debt. The exemption usually covers the month before, the months during, and the month after the hardship.

How to Get Covered and Avoid the Penalty

Covered California is the state marketplace for individual and family plans if you don’t have coverage through an employer or a government program. Financial help reaches further up the income scale than many people expect, with some families earning up to $154,500 per year receiving premium assistance.⁷

Open enrollment for 2026 coverage runs through January 31, 2026. Select a plan by December 31 to have coverage in place January 1 with no gap.⁸ Outside open enrollment, a qualifying life event such as losing other coverage, marriage, a new baby, or a move to California opens a special enrollment window. California also treats paying the mandate penalty on a prior return as a qualifying event, so you can enroll rather than pay again.⁹

Reporting Coverage and Paying the Penalty

Coverage is reported on Form 540. If everyone in your household had qualifying coverage for all 12 months, you check the box on line 92 and file nothing extra.¹⁰

If anyone had a gap or an exemption, you complete FTB Form 3853. The form lists each uninsured household member, the months they lacked coverage, and any exemption code that applies (for example, Code A for unaffordable coverage, Code C for a short gap, or Code H for incarceration). The final penalty flows from Form 3853 to Form 540 and is added to what you owe or subtracted from your refund.⁴

The FTB verifies what you report using the 1095-B and 1095-C data that insurers and employers file with the IRS, which federal law allows the IRS to share with state tax agencies.¹¹ Once assessed, the penalty is treated like any other California income tax balance. That matters because the old federal mandate barred the IRS from using liens or levies to collect, leaving only refund offsets.¹² California has no such restriction. Unpaid amounts accrue interest, and the FTB can pursue state tax liens and bank levies the way it does with any unpaid tax debt.¹³

Penalty Amounts Change Each Year

The statute’s base per-adult amount is $695, adjusted for cost of living annually after 2019. For 2025 that produces the $950 adult and $475 child figures.² The bronze plan cap also moves with marketplace pricing. Confirm the current numbers on the FTB’s mandate page or the current Form 3853 instructions before you file, because older calculators and articles often quote outdated figures.¹

1
Franchise Tax Board. Personal Health Care Mandate
2
California Legislative Information. California Revenue and Taxation Code 61015
3
Franchise Tax Board. Residents – FTB.ca.gov
4
Franchise Tax Board. 2025 Instructions for Form FTB 3853
5
Franchise Tax Board. FTB Publication 1031 – Guidelines for Determining Resident Status
6
eCFR. 26 CFR 1.5000A-2 – Minimum Essential Coverage
7
Covered California. California Subsidy
8
Covered California. Covered California Open Enrollment 2026
9
Covered California. Major Life Changes – Qualifying Life Events
10
Franchise Tax Board. 2025 Instructions for Form 540
11
Internal Revenue Service. Instructions for Forms 1094-B and 1095-B
12
Internal Revenue Service. Questions and Answers on the Individual Shared Responsibility Provision
13
Franchise Tax Board. FTB 1140 Personal Income Tax Collections Information