Tax-related Information for Marketplace Consumers

It’s that time of year again when we buckle down with our W2s and other tax-related documents to submit our tax returns. (This year, the 2015 tax return is due by Monday, April 18, 2016; the traditional April 15th deadline is pushed back in 2016 due to a District of Columbia holiday).

For marketplace consumers who received advanced payment of the premium tax credit (APTC) or want to claim their premium tax credit in 2015, they will need to reconcile the premium tax credit as part of their 2015 tax return. This means making sure they have a copy of Form 1095-A, which has information on their marketplace coverage like the premium amounts, any advance payments of the premium tax credit, and who in the household had marketplace coverage. The marketplace sends the Form 1095-A and consumers should receive a copy by early February. If consumers have not received a copy or information on their Form 1095-A is incorrect, then they should contact the marketplace. If consumers have an online healthcare.gov account, then they can access a copy of the Form 1095-A from their online account.

Using the information from the Form 1095-A, marketplace consumers can complete Form 8962, the form used to reconcile your premium tax credit. Since the amount of the premium tax credit is based on projected income, consumers must reconcile the amount at tax time using their actual income for 2015. For those who received too much premium tax credit, they may have to pay back the excess amount. For those who received too little premium tax credit, they will likely receive a refund.

Healthcare.gov has a tax time tool, available here, which should help consumers who receive incorrect or incomplete information on their Form 1095-A. Consumers can also use the tool to help them claim an affordability exemption from the individual mandate penalty. Consumers wanting to claim an exemption must use Form 8965 and submit it with their tax return. We go over the available exemptions and how to claim them in our Navigator Resource Guide, which include the frequently asked questions (FAQ):

  • Are there exemptions to the penalty? What are they? (FAQ 1.1.5)
  • How do I apply for an exemption? (FAQ 1.1.6)
  • I live overseas, do I still have to comply? (FAQ 1.1.11)

Some consumers may go to a tax preparer to get help with preparing and submitting their taxes. Last year, the I.R.S. received complaints about some preparers telling consumers incorrectly that they had to pay for being uninsured even when they had coverage. In particular, the I.R.S. found some predatory tax preparers targeting consumers with limited English proficiency. The I.R.S. has issued an alert about choosing a tax preparer including a link to a searchable directory of tax preparers with recognized I.R.S. credentials.

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