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FACT: Penalties for failing to purchase health insurance under the new Affordable Health Care Act start in 2014. The fines start as low as $95 per year for an individual, or 1 percent of a person’s income. By 2016 the individual penalty will rise to $695 or 2.5 percent of income, whichever is higher, unless the individual meets a poverty test or is on Medicaid. This is the “individual mandate” upheld in 2012 by the Supreme Court as a tax, meaning the IRS will collect any penalties. The Congressional Budget Office estimates 5.9 million Americans – 1.9 percent of the population – would face the penalty unless they obtain health insurance. CBO expects the penalty to raise $7 billion to $8 billion.