When you enroll, the Marketplace will determine if you are eligible for advance payments of the premium tax credit, also called advance credit payments or APTC. Filing electronically is the easiest way to file a complete and accurate tax return. I filed my 2020 tax return without Form 8962 and did not get a letter from the IRS asking for it but think I have excess APTC. No. With a health insurance tax credit, you set yourself up to use tax credits for saving money on health insurance when you enroll in a plan. If you choose to forego advanced payments, youll get all of the benefit of the PTC when you file your tax return. Filing your return without reconciling your advance credit payments will delay your refund and may affect your eligibility for future advance credit payments. Know how we can help improve the tax process or better meet your needs? For tax years other than 2020, if you have APTC in any amount, you must file aForm 8962, and attach it to your federal income tax return for that year. You must also meet the other eligibility criteria. Note: Form 8962 can also be claimed on the new IRS form 1040 SR, U.S. Tax Return for Seniors, for taxpayers age 65 and older. If you dont tell the Marketplace about the increase in household income, your APTC, which was computed based on your household income before the salary increase, will likely be more than the PTC youre allowed. All the facts and circumstances are considered in determining whether an individual is abused, including the effects of alcohol or drug abuse by the victims spouse. There is no need to contact the IRS. (added February 24, 2022), Q40. (updated February 24, 2022), Q9. You may be eligible for a premium tax credit for coverage of another member of your family who enrolls in Marketplace coverage and is not enrolled in the employer plan. If you, or your spouse (if filing a joint return), received, or were approved to receive, unemployment compensation for any week beginning during 2021, the amount of your household income is considered to be no greater than 133% of the federal poverty line for your family size and you are considered to have met the household income requirements for eligibility for a premium tax credit. Cannot be claimed as a dependent by another person. Changes in circumstances to report to the Marketplace include: *Note Lump sum distributions such as social security disability insurance (SSDI) are often missed as changes in circumstances. I am a smoker. However, if an individual enrolls in a qualified health plan and the enrollment is effective on the date of the individuals birth, adoption, or placement for adoption or in foster care, or on the effective date of a court order, the individual is treated as enrolled as of the first day of that month. You can also choose to get all of the benefit when you claim the PTC on your tax return. Will I have to file a federal income tax return and attach Form 8962 to get the premium tax credit for a tax year other than the 2020 tax year (updated February 24, 2022), Q25. wi.hctc . Youll need to complete IRS Form 8962 and file it with your regular tax return. Accordingly, if you were enrolled in both Medicaid coverage and in a qualified health plan for which advance credit payments were made for one or more months of the year following a Marketplace determination or assessment that you were ineligible for Medicaid, you can claim the premium tax credit for these months, if you are otherwise eligible. What should I do? The IRS will soon mail letters on behalf of the Center for Medicare & Medicaid Services, sharing information about obtaining Marketplace healthcare coverage. When possible, be sure to consider potential receipt of SSDI or similar income when estimating your household income if youre electing APTC. LITCs can represent taxpayers in audits, appeals, and tax collection disputes before the IRS and in court. If you are claiming net Premium Tax Credit (PTC) on Form 1040 or 1040-SR, Schedule 3, Line 8, you must file Form 8962 with your return and report net PTC on Line 26. Q31. If your actual allowable credit is more than your APTC, the difference will be added to your refund or subtracted from your balance due. 2015, the percentage is 9.56 percent see, 2016, the percentage is 9.66 percent see, 2017, the percentage is 9.69 percent see, 2018, the percentage is 9.56 percent see, 2019, the percentage is 9.86 percent see, 2020, the percentage is 9.78 percent see, 2021, the percentage is 9.83 percent see, 2022, the percentage is 9.61 percent see, 2023, the percentage is 9.12 percent see, You are allowed a PTC for 2020 but were not eligible for, or chose not to receive the benefit of, APTC at enrollment in Marketplace coverage for 2020, or. If youre claiming a net premium tax credit for 2020, you must file Form 8962, Premium Tax Credit (PTC). Taxpayers may claim this relief from the joint filing requirement for no more than threeconsecutive years. Q13. Who is eligible for the premium tax credit? Yes. A27. Q23. A25. Keep any supporting documentation related to receiving or the approval to receive unemployment compensation with your tax return records. The IRS will not be able to answers questions about the information on your Form 1095-A or about missing or lost forms. For details about who is eligible for a special enrollment period, for information about future open enrollment periods, and to learn more about the Marketplace, visit HealthCare.gov. I applied for unemployment compensation for 2021 but my initial application was denied. A26. Beginning in July 2021, the IRS reviewed tax returns filed prior to the enactment of ARPA to identify tax returns on which both excludible unemployment compensation and excess APTC repayments were reported by the taxpayer. If you claim a net Premium Tax Credit for 2020, you must file Form 8962. When you apply for coverage in the Health Insurance Marketplace , you estimate your expected income for the year.If you qualify for a premium tax credit based on your estimate, you can use any amount of the credit in advance to lower your premium. Do I need to report or repay that excess amount and file Form 8962? (updated February 24, 2022). Keep the letter or other documentation you received that shows your appeal resulted in your approval to receive your 2021 unemployment compensation. Open Enrollment is over. Under these circumstances, you would still be eligible for the premium tax credit if you meet the other eligibility criteria even though the employer-sponsored coverage would have been affordable based on your actual household income. For tax year 2021, if a taxpayer or the taxpayers spouse (if filing a joint return) received, or was approved to receive, unemployment compensation for any week beginning during 2021, the amount of the taxpayers household income is considered to be no greater than 133 percent of the federal poverty line for his or her family size and the taxpayer is considered to have met the household income requirements for being allowed a premium tax credit. Page Last Reviewed or Updated: 07-Oct-2022, Request for Taxpayer Identification Number (TIN) and Certification, Employers engaged in a trade or business who pay compensation, Excludible Unemployment Compensation for 2020, Individual Shared Responsibility Provision, Affordable Care Act - What to expect when filing your tax return, Gathering Your Health Coverage Documentation for the Tax Filing Season, ACA Information Center for Tax Professionals, How to correct an electronically filed return rejected for a missing Form 8962, Electronic Federal Tax Payment System (EFTPS), advance payments of the premium tax credit, Claiming the Credit and Reconciling Advance Credit Payments, Premium Tax Credit: Claiming the Credit and Reconciling Advance Credit Payments, Requirement to repay excess advance payments of the premium tax credit is suspended and certain unemployment compensation is excludible, Health Insurance Marketplace Statement page, Treasury Inspector General for Tax Administration. The IRS will reduce the excess APTC repayment amount to zero with no further action needed by the taxpayer. Subsequently, I was determined eligible for Medicaid and was enrolled for several months while I was enrolled in the qualified health plan. The IRS will refund the excess APTC repayment amount you paid on your 2020 tax return and youll get a letter from the IRS explaining the changes we made. You claim the premium tax credit and reconcile the credit with the amount of your advance credit payments for the year on Form 8962. A30. No, your dependent's receipt of, or approval to receive, unemployment compensation during 2021 does not cause you to meet the household income limits for premium tax credit eligibility or make you an applicable taxpayer. In addition, LITCs can provide information about taxpayer rights and responsibilities in different languages for individuals who speak English as a second language. See the Coronavirus Tax Relief section on this page for information specific to tax year 2020. Who should file Form 8962 with their 2020 tax return? Spouse cannot be enrolled in Ys employer-sponsored coverage unless Employee is an employee of Y, and Y will terminate Employees employment if Employee attempts to enroll Spouse in Ys coverage. I received or was approved to receive unemployment compensation in 2021 and my household income was less than 100 percent of the federal poverty line. The health coverage tax credit is a program in place for tax years from 2002 to 2013 and was later extended through 2019 to help eligible individuals and families by paying a portion of premiums for qualified health insurance programs. The Health Coverage Tax Credit is a tax credit that pays 72.5 percent of qualified health insurance premiums for eligible individuals and their families. This effort to issue refunds to those who paid an excess APTC repayment amount on their 2020 return is ongoing and will continue. A24. If your employer offers any wellness programs (including programs based on a health factor or requiring that the wellness incentive be earned), the affordability test is based on the premium you would pay if you received the maximum discount for any tobacco cessation programs and did not receive any other discounts based on wellness programs. Q12. That document will give you information about the benefits and coverage under your employer-sponsored plan, including whether the plan provides minimum value. If you believe that you may currently be enrolled in both Medicaid and a qualified health plan with advance credit payments, you should contact the Marketplace immediately. Beginning in July 2021, the IRS reviewed tax returns filed prior to the enactment of ARPA to identify tax returns on which both excludible unemployment compensation and excess APTC repayments was reported by the taxpayer. The Department of Health and Human Services (HHS) determines the federal poverty guideline amounts annually. File Form 8962 with your Form 1040,Form 1040-SR or Form 1040-NR. I filed my 2020 tax return and got a letter from the IRS asking for Form 8962 because I have excess APTC. Employee will be allowed a premium tax credit if Employee meets the other eligibility requirements for the credit. A tax credit you can use to lower your monthly insurance payment (called your "premium") when you enroll in a plan through the Health Insurance Marketplace . I applied for unemployment compensation with your regular tax return process or better meet your needs that pays percent. And was enrolled for several months while I was enrolled in the qualified insurance. 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