The Shared Responsibility Payment (SRP) was a penalty imposed on individuals who did not maintain minimum essential health coverage as required under the Affordable Care Act (ACA). This penalty, also known as the individual mandate, was designed to encourage individuals to purchase health insurance and avoid burdening the healthcare system.
The SRP was calculated based on:
- A percentage of household income, or
- A flat dollar amount per person in the household, whichever was higher.
As of 2019, the SRP was effectively repealed, meaning individuals are no longer required to pay this penalty for not having health insurance. However, the SRP still applies for tax years prior to 2019, and taxpayers may be assessed the penalty if they did not have qualifying health coverage during those years.