Premium Tax Credit - Publication 974
Premium Tax Credit – Publication 974
Tax Guide Publication # 17 288 pages
Tax Guide Publication # 17 288 pages
irs.5187
IRS 5187 New for 2014 – Health Care Law

Subsidy Verification and Tax Forms

Check out the Premium Tax Credit Publication #974.  for more than you ever wanted to know on how to file and understand the subsidies to purchase Health Insurance.

Scroll down for links to the tax forms or use the menu above.

Be sure to file your taxes on time, even if there are problems with Covered CA sending you the correct 1095 A or you risk losing subsidies in the future – Learn More⇒ CA Health Line 8.25.2015

Tax Estimators

turbotax.com   ♦  H & R Block  ♦  Efile.com

FREE software

To do your taxes if  you earn less than $60k   AGI – Line 37   double check at wikipedia and  IRS.Gov/FreeFile.  If you earn more, you can find the forms below or at the IRS website.

FAQ’s

Kaiser Foundation FAQ’s for 2014 Taxes

Kaiser Permanente Reminder to do 2014 Taxes

Taxpayer Bill of Rights

 

 

 

  IRS Withholding Calculator

Child Pages – Tax Forms, Publications, Etc.

 

Breaking News

IRS ignoring 60% of phone calls CNBC 3.31.2015  so, we have most everything you want posted here.

CNN 4.27.2015 reports that H & R Block reports average refund lowered by $729 due to under reporting MAGI income.

1.12.2015 CA Health Line on ACA and tax issues if there is a change in income.  ♦  My own CPA’s – Bruce Bialosky thoughts on TownHall

IRS budget cuts, fewer employees, forget calling them  LA Times 1.16.2015

Answers to Five of Your Questions about the Premium Tax Credit

The premium tax credit is a refundable credit that helps eligible individuals and families with low or moderate income afford health insurance purchased through a Health Insurance Marketplace. To get this credit, you must meet certain eligibility requirements and file a tax return.

Here are five questions the IRS is hearing from taxpayers, along with answers and where to go for more information.

  1. What is included in household income?

For purposes of the PTC, household income is the modified adjusted gross income of you and your spouse if filing a joint return, plus the modified AGI of each individual in your tax family whom you claim as a dependent and who is required to file a tax return because their income meets the income tax return filing threshold. Household income does not include the modified AGI of those individuals you claim as dependents and who are filing a return only to claim a refund of withheld income tax or estimated tax. For this and other detailed premium tax credit questions and answers visit IRS.gov/aca.

  1. The IRS is asking to see my 1095-A. What should I do?

You should follow the instructions on the correspondence that you received from the IRS.  You may be asked for a copy of Form 1095-A in order to verify information that has been entered on your tax return.  Visit our Health Insurance Marketplace Statements webpage for more information about Form 1095-A and how to obtain a copy,

  1. If I got advance payments of the PTC, do I have to file even if I never had a filing requirement before?

Yes. If you received the benefit of advance payments of the premium tax credit, you must file a tax return to reconcile the amount of advance credit payments made on your behalf with the amount of your actual premium tax credit.  You must file a return and submit a Form 8962 for this purpose even if you are otherwise not required to file a return.

  1. Marketplace says I did not file, but I did file before the extended due date.  What should I do?

In advance of the open enrollment period that runs through January 31, 2016, the Marketplace sent Marketplace Open Enrollment and Annual Redetermination letters to individuals who might not have filed a tax return. Follow the instructions in the letter you received.

  • Log in to your Marketplace account to update your 2016 Marketplace application.
  • Check the box telling the Marketplace you reconciled your premium tax credits by filing a 2014 tax return and Form 8962.
  • Update your Marketplace application by December 15, 2015.
  • If you don’t update your Marketplace application, any help with costs you currently get will stop on December 31, 2015 and you’ll be responsible for the full upfront costs of your Marketplace plan and covered services.
  • For more help visit HealthCare.gov or call your Marketplace.
  1. What are my options to receive help with filing a return and reconciling?

Filing electronically is the easiest way to file a complete and accurate tax return as the software guides you through the filing process. Electronic filing options include free Volunteer Assistance, IRS Free File, commercial software, and professional assistance. For information about filing a return and reconciling advance credit payments, visit IRS.gov/aca.

The Premium Tax Credit – The Basics

 

If you – or anyone on your federal tax return enrolled in health insurance coverage through the Health Insurance Marketplace, you may be eligible for the premium tax credit.

Here are some basic facts about the premium tax credit.

What is the premium tax credit?

The premium tax credit is a credit that helps eligible individuals and families with low or moderate income afford health insurance purchased through the Health Insurance Marketplace.

What is the Health Insurance Marketplace?

The Health Insurance Marketplace is the place where you will find information about private health insurance options, purchase health insurance, and get help with premiums and out-of-pocket costs, if you are eligible. Learn more about the Marketplace at HealthCare.govHow do I get the premium tax credit? When you apply for coverage, the Marketplace will estimate the amount of the premium tax credit that you may be able to claim for the tax year, using information you provide about your family composition and projected household income. Based upon that estimate, you can decide if you want to have all, some, or none of your estimated credit paid in advance directly to your insurance company to be applied to your monthly premiums.

If you choose to have all or some of your credit paid in advance, you will be required to reconcile on your income tax return the amount of advance payments that the government sent on your behalf with the premium tax credit that you may claim based on your actual household income and family size. You must file an income tax return for this purpose even if you are otherwise not required to file a return.

You’ll file Form 8962, Premium Tax Credit, with your tax return to claim or reconcile the credit. Failing to file your tax return will prevent you from receiving advance credit payments in future years. Filing electronically is the easiest way to file a complete and accurate tax return.

What happens if my income or family size changes during the year?   The actual premium tax credit for the year will differ from the advance credit amount estimated by the Marketplace if your family size and household income as estimated at the time of enrollment are different from the family size and household income you report on your return. The more your family size or household income differs from the Marketplace estimates used to compute your advance credit payments, the more significant the difference will be between your advance credit payments and your actual credit.

Visit the PTC Eligibility page on IRS.gov/aca or use our interactive tool, Am I eligible to claim the Premium Tax Credit? on IRS.gov to determine your eligibility.

For more information about the Affordable Care Act and your income tax return, visit IRS.gov/aca.

 

Issue Number:    FS-2016-10

Inside This Issue

Affordable Care Act: Tax Facts for Individuals and Families

The Affordable Care Act includes the individual shared responsibility provision and the premium tax credit that may affect your tax return. This year marks the first time that certain taxpayers will receive new health-care related information forms that they can use to complete their tax return and then keep with their tax records.

Information Forms – Forms 1095-A, 1095-B and 1095-C

Depending upon your specific circumstances, the Health Insurance Marketplace, health coverage providers, and certain employers may provide information forms to you early in 2016. These forms can help you accurately report health coverage information for you, your spouse and any dependents when you file your 2015 individual income tax return in 2016. The Marketplace, health coverage providers, and employers will also file these forms with the IRS.

The information forms are:

  • Form 1095-A, Health Insurance Marketplace Statement: The Health Insurance Marketplace sends this form to individuals who enrolled in coverage there, with information about the coverage, who was covered, and when.  This is the second year in which the Marketplace is issuing Form 1095-A to enrollees.
  • Form 1095-B, Health Coverage: Health insurance providers – for example, health insurance companies – send this new form to individuals they cover, with information about who was covered and when.
  • Form 1095-C, Employer-Provided Health Insurance Offer and Coverage: Certain employers send this new form to certain employees, with information about what coverage the employer offered. Employers that offer health coverage referred to as “self-insured coverage” send this form to individuals they cover, with information about who was covered and when.

The list below highlights key elements regarding these information forms:

  • The deadline for the Marketplace to provide Form 1095-A is February 1, 2016.
  • The deadline for coverage providers to provide Forms 1095-B and employers to provide Form 1095-C is March 31, 2016.
  • If you are expecting to receive a Form 1095-A, you should wait to file your 2015 income tax return until you receive that form.
  • Some taxpayers may not receive a Form 1095-B or Form 1095-C by the time they are ready to file their 2015 tax return. It is not necessary to wait for Forms 1095-B or 1095-C in order to file. Taxpayers may instead rely on other information about their health coverage and employer offer to prepare their returns
  • These new forms should not be attached to your income tax return.

See our questions and answers that explain who should expect to receive the forms, how they can be used, and how to file with or without the forms, and that address various other questions you may have about these new forms.

Individual Shared Responsibility Provision

The individual shared responsibility provision requires everyone on your tax return to have qualifying health care coverage for each month of the year or have a coverage exemption. Otherwise, you may be required to make an individual shared responsibility payment.

The list below highlights key elements of the individual shared responsibility provision:

  • If you maintain qualifying health care coverage for the entire year, you don’t need to do anything more than report that coverage on your federal income tax return by simply checking a box. Qualifying coverage includes most employer-sponsored coverage, coverage obtained through a Health Insurance Marketplace, coverage through most government-sponsored programs, as well as certain other specified health plans.
  • If you go without coverage or experience a gap in coverage, you may qualify for an exemption from the requirement to have coverage. If you qualify for an exemption, you use Form 8965, Health Coverage Exemptions, to report a coverage exemption granted by the Marketplace or to claim a coverage exemption on your tax return.
  • If for any month during the year you don’t have qualifying coverage and you don’t qualify for an exemption, you will have to make an individual shared responsibility payment when you file your federal income tax return.
  • The payment amount for 2015 is the greater of 2 percent of the household income above the taxpayer’s filing threshold, or $325 per adult plus $162.50 per child (limited to a family maximum of $975). This payment is capped at the cost of the national average premium for a bronze level health plan available through Marketplaces that would provide coverage for the taxpayer’s family members that neither had qualifying coverage nor qualify for a coverage exemption. The instructions for Form 8965, Health Coverage Exemptions, provide the information needed to calculate the payment that will be reported on you federal income tax return.
  • Form 1095-B will be sent to individuals who had health coverage for themselves or their family members that is not reported on Form 1095-A or Form 1095-C. Form 1095-A will be sent to individuals who enrolled in health coverage for themselves or their family members through the  Marketplace. Form 1095-C will be sent to certain employees of applicable large employers.
  • Some taxpayers may not receive a Form 1095-B or Form 1095-C by the time they are ready to file their 2015 tax return. It is not necessary to wait for Forms 1095-B or 1095-C in order to file. Taxpayers may instead rely on other information about their health coverage and employer offer to prepare their returns

Health Coverage Exemptions

 

Individuals who go without coverage or experience a gap in coverage may qualify for an exemption from the requirement to have coverage.

  • You may qualify for an exemption if one of the following applies:
    • You do not have access to affordable coverage
    • You have a one-time gap of less than three consecutive months without coverage
    • You qualify for one of several other exemptions, including a hardship exemption
  • How you get an exemption depends upon the type of exemption. You can obtain some exemptions only from the Marketplace in the area where you live, others only from the IRS when filing your income tax return, and others from either the Marketplace or the IRS. For more information, visit gov/aca or see the instructions to Form 8965.
  • If you qualify for an exemption, you use Form 8965 to report a coverage exemption granted by the Marketplace or to claim a coverage exemption on your tax return.

Premium Tax Credit

For an explanation of the Premium Tax Credit see IRS Fact Sheet 2016-05, entitled “Tax Credit Helps Make Health Insurance Affordable for Middle-Class Americans.”

More Information

 

Remember that filing electronically with tax preparation software is the quickest and easiest way to file a complete and accurate tax return, as the software guides you through the filing process and does all the math for you.

For more information about the premium tax credit or the individual shared responsibility payment, visit IRS.gov/aca. For more information about the Marketplace, visit HealthCare.gov. For more information on the new health care related information forms, see the Form 1095 questions and answers.

 

How the Taxpayer Advocate Service Can Help

The Taxpayer Advocate Service is an independent organization within the Internal Revenue Service. We protect taxpayers’ rights by ensuring that all taxpayers receive fair treatment. We can also help you to know and understand your rights under the Taxpayer Bill of Rights.

What is the Taxpayer Bill of Rights?

The Taxpayer Bill of Rights describes ten basic rights that all taxpayers have when dealing with the IRS. Our taxpayer rights webpage can help you understand what these rights mean to you and how they apply. These are your rights. Know them. Use them.

Our site at taxpayeradvocate.irs.gov also can help you with common tax issues and situations: what to do if you made a mistake on your tax return, if you got a notice from the IRS or you’re thinking about hiring a tax preparer.

What can a Taxpayer Advocate do for you?

We can help you resolve problems that you can’t resolve with the IRS. And our service is free. Always try to resolve your problem with the IRS first, but if you can’t, then come to the Taxpayer Advocate Service. The best thing you can do is act now!

  • We help individuals, businesses, and exempt organizations. If you qualify for our help, your advocate will be with you at every turn and do everything possible.
  • You may be eligible for our help if your IRS problem is causing financial difficulty or you believe an IRS procedure just isn’t working as it should.
  • We have offices in every state, the District of Columbia, and Puerto Rico. Your local advocate’s number is in your local directory and at taxpayeradvocate.irs.gov. You can also call us at 1-877-777-4778.

We also handle large-scale problems that affect many taxpayers. If you know of one of these broad issues, please report it to us at irs.gov/sams.

The Taxpayer Advocate Service is your voice at the IRS.

Each and every taxpayer has a set of fundamental rights they should be aware of when dealing with the IRS. These are your Taxpayer Bill of Rights. Explore your rights and our obligations to protect them on IRS.gov.

IRS YouTube Videos:

IRS Podcasts:

IRS Tax Tip 2016-59

 

Historical

More draft tax forms for 2014

Draft 1040 for 2014

Check out IRS Publication 5187 Health Law – What’s New – it’s a really informative pamphlet on the new rules under Health Care Reform and Subsidies.

Claim the Premium Tax Credit & Reconcile Advance Credit Payments on Your 2015 Income Tax Return

You may be eligible to claim the premium tax credit on your 2015 income tax return. The premium tax credit helps eligible individuals and families with low or moderate income afford health insurance. Millions of people who purchased their coverage through a health insurance Marketplace are eligible for premium assistance through the premium tax credit, which individuals chose to either have paid upfront to their insurers as advance payments to lower their monthly premiums or receive when they file their taxes.

If you received the benefit of advance credit payments, you must file a federal tax return and reconcile the advance credit payments with the actual premium tax credit you are eligible to claim on your return.  Failing to file your tax return to reconcile advance payments will prevent you from receiving advance credit payments in future years.

You will use IRS Form 8962, Premium Tax Credit (PTC) to make this comparison and to claim the credit. If your advance credit payments are in excess of the amount of the premium tax credit you are eligible for, based on your actual income, you must repay some or all of the excess when you file your return, subject to certain caps.

If you or anyone on your tax return enrolled in health coverage through the Health Insurance Marketplace, you should receive Form 1095-A, Health Insurance Marketplace Statement from your Marketplace form by early February. Use the information from Form 1095-A to file your taxes accurately. This information includes the name of your insurance company, dates of coverage, amount of monthly insurance premiums for the plan you and other members of your family enrolled in, amount of any advance payments of the premium tax credit for the year, and other information needed need to compute the premium tax credit.

Using tax preparation software is the best and simplest way to file a complete and accurate tax return as it guides individuals and tax preparers through the process and does all the math. Electronic filing options include IRS Free File for taxpayers who qualify, free volunteer assistance, commercial software, and professional assistance.

More Information

Visit the PTC Eligibility page on IRS.gov/aca or use our interactive tool, Am I eligible to claim the Premium Tax Credit? on IRS.gov to determine your eligibility.

For more information about the Affordable Care Act and filing your 2015 income tax return, visit IRS.gov/aca.

Subscribe to IRS Tax Tips to get easy-to-read tips via e-mail from the IRS.

We do NOT give tax or legal advise!  Only links and excerpts of the law or Insurance Company Bulletins.

 

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