Skip to Main Content

New Tax Filing Requirements Under the Affordable Care Act

The Affordable Care Act (aka ACA or health care law) contains health insurance coverage and financial assistance options for Americans. And, as of tax year 2014, our friends at the IRS, who administer ACA’s tax provisions, now require additional tax return reporting for some taxpayers with regard to various aspects of their health insurance coverage.

Are you covered …or do you buy coverage?

If you already have qualifying health care coverage, you don’t need to do anything more than continue with your insurance and there are no tax filing requirements.

If you don’t have coverage, you will need to, either obtain an exemption from coverage (due to financial hardship or other ACA defined factors) and report it on your federal income tax return, or, if you are not eligible for an exemption, make an Individual Shared Responsibility penalty payment with your return.

Alternatively, you can buy health insurance through the health insurance marketplace (aka the “Marketplace” or “Exchange”). If you buy health insurance, you may be eligible for a premium tax credit that makes the cost of coverage more affordable.

What’s is the Premium Tax Credit (“PTC “)

The premium tax credit is new for 2014, and is a refundable tax credit that will either lower the amount of taxes owed on your return or increase your refund— but will require to you to file a federal tax return in 2014. To be eligible for the PTC, you must meet all of the following requirements:

  • Purchase coverage through the Marketplace
  • Have household income that falls within a certain range (100% to 400% of the federal poverty line) based on family size (for 2014, the max is $45,960 for a single, $62,040 for a family of two and $94,200 for a family of four)
  • Are not able to obtain affordable coverage through an eligible employer plan that provides minimum value
  • Are not eligible for coverage through a government program, like Medicaid, Medicare, CHIP or TRICARE
  • Your tax return filing status, with limited exceptions, is not Married Filing Separately
  • No one else can claim you as a dependent

Income Tax Return Reporting For Purchased Health Insurance

If you purchase health insurance, you will receive a 2014 Form 1095-A information statement by January 31, 2015 that provides the amount of your premiums and advance credit payments. Make sure to include this information with your year-end tax materials for proper tax filing. Report your PTC on Form 8962 and any exemption from coverage on Form 8965.

Do you have questions about income tax reporting and your health care coverage? Contact Victor C. Belgiorno at 516-861-3704 or  or Bob Jahelka at 516-861-3707 or .

 

 
This entry was posted in News & Articles. Bookmark the permalink. Follow any comments here with the RSS feed for this post. Both comments and trackbacks are currently closed.