# Question about avoiding the USA Obamacare tax penalty (move to Macau)



## Ness7891 (May 10, 2016)

Hi. Posting here because me and my spouse are about to be expats. She's originally from Macau and I'm from USA. We're both American citizens and after living here a while we've decided to move to Macau. We have health insurance in America, but are largely unsatisfied with it's service. We want to cancel because it's such a big mess. However we're wondering if we should just cancel now and have that headache out of the way or wait until we leave the country a about a month and a half from now. We'll be leaving at the end of June. So we don't know if we cut ties now, would we be on the hook for any kind of tax penalty for not having insurance for two months? From what we've looked into, as long as we're out of the country for 330 days within a 12 month period we can be exempt from any kind of tax penalty in regards to not having insurance I believe. Also if I become a bona fide resident of my new country I think. That could take up to a year for Macau I'm told. My wife is looking into health insurance in Macau which would cover us even if we were in the US. So...I don't know if that helps. Or how we would even apply that to filing our taxes because it's a foreign company. 

Basically I'm really confused and not sure what we should do. And when would that "330" day period start anyways if true? The day I leave? The day I don't have insurance? And what if I come back during that time for a a visit in the US? How does that dynamic work for the 12th months? I'm going to a tax adviser in two days, but I want to make sure I understand things further since I'll be paying a consolation fee per hour for his time. Again, I'll be leaving in late June.


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## BBCWatcher (Dec 28, 2012)

Ness7891 said:


> However we're wondering if we should just cancel now and have that headache out of the way or wait until we leave the country a about a month and a half from now. We'll be leaving at the end of June. So we don't know if we cut ties now, would we be on the hook for any kind of tax penalty for not having insurance for two months?


OK, the most important thing is to have at least adequate medical insurance at all times in order to protect both your health and your financial well-being. Consequently you shouldn't cancel your U.S. medical insurance until you have at least adequate insurance in Macau. If that insurance covers you now, adequately, great. But probably not, so you'll have to wait until you land in Macau and are actually well covered there.

The tax considerations are very secondary to those considerations. So start with those much more important considerations.


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## Bevdeforges (Nov 16, 2007)

Practically speaking, the 330 day period starts on the day you "move" outside the country. (I think I've read somewhere that the day of departure counts as being in the US for the day, so plan accordingly.) You can't really claim the physical presence test until the one year anniversary date of your arrival (or probably, 330 days later if you make no return visits to the US), so if you move in, say August, you'll have to extend your filing deadline to August for the 2016 tax year to claim your rights.

Just don't forget that you will continue to have to file US returns (and claim the exemption from ACA coverage) going forward, no matter what your status overseas.
Cheers,
Bev


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