AFFORDABLE CARE ACT: TAX PLANNING
When you file your tax return and have had medical insurance all
year for yourself and your dependents, all you need to do is to
check a box on your tax return. This includes:
1. Individually owned policies
2. Employer-provided insurance which meets at least the
minimum federal standards
3. Policies purchased from state or federal exchanges
4. Medicare
5. Medicaid
6. Tricare (military personnel, retirees and their dependents)
7. Veterans
Exchanges using Form 1095-A, and employers using Form 1095-C
will provide these to the insured and the IRS as evidence
of compliance.
Those who are eligible for a subsidy may not file taxes using
Form 1040 EZ, and will need to file Form 8962 with their 1040
Tax Return. It looks complicated so you may need help.
Generally, such subsidies are available only for coverage
purchased through an exchange by taxpayers with household
incomes between 100% and 400% of the federal poverty level.
Those who do not have health insurance will owe a tax unless
they have an approved exemption which needs to be filed on
Form 8965 and filed with their 1040 Tax Return beginning in
2014. The amount of the penalty is scheduled to increase each
year. Reasons for exemptions may include:
1. Hardship situations such as bankruptcy, natural disasters,
etc.
2. Household incomes below those required to file a return
3. Those with less than three months without coverage