ACA adds new forms for taxpayers

Posted January 13, 2015 Industry Insights, Expert Tips, Company News

Did you know that the Affordable Care Act (“Obamacare”) may affect how you file your taxes? The IRS has just published two new taxes forms, as well as made changes to three existing ones.

New Forms

The new forms document whether you had insurance. If you were insured for all of 2014, you will just need to check a box to indicate that you had coverage for the entire year. Taxpayers who were not insured for the entire year, bought a plan on the Marketplace, or received premium tax credits will have to fill out more information.

 

Health Coverage Exemptions

If you didn’t have health insurance in 2014, or were only insured for part of 2014, this year you’ll have to file Form 8965. You’ll use this new form to report a Marketplace-granted coverage exception or claim an IRS-granted coverage exemption on your return. If none of these exemptions apply to you, there’s a worksheet in the Form 8965 Instructions to help you calculate the penalty for the months that you didn’t have insurance.

 

Health Insurance Marketplace Statement

Did you buy a plan on the Marketplace? You should receive Form 1095-A by January 31. This form tells you how much your insurer received in advance tax credits, information which will help you complete Form 8965.

 

Premium Tax Credits

You’ll use Form 8962 to reconcile advance payments of the premium tax credit and to claim that credit on your tax return. Basically, this form is what you use to claim a refund if you received too little in advance premium tax credits.

 

Changed Forms

The Affordable Care Act didn’t just add new tax forms; it also changed some of the existing ones. While you do your taxes, be on the lookout for the new lines that the health care law added to Forms 1040, 1040A, and 1040EZ.

 

Individual Income Tax Return

The changes made to Form 1040 this year are as follows:

  • Line 46: Enter advance payments of the premium tax credit that must be repaid
  • Line 61: Report health coverage and enter individual shared responsibility payment
  • Line 69: If eligible, claim net premium tax credit, which is the excess of allowed premium tax credit over advance credit payments

The IRS has published Form 1040 instructions to help you fill out the form correctly.

 

Individual Income Tax Return (varied incomes and deductions)

The changes made to Form 1040A this year are as follows:

  • Line 29: Enter advance payments of the premium tax credit that must be repaid
  • Line 38: Report health coverage and enter individual shared responsibility payment
  • Line 45: If eligible, claim net premium tax credit, which is the excess of allowed premium tax credit over advance credit payments

The IRS has published Form 1040A instructions to help you fill out the form correctly.

 

Income Tax Return for Single and Joint Filers With No Dependents

You cannot use Form 1040EZ to report advance payments or claim premium tax credits. The change made to this form is as follows:

  • Line 11: Report health coverage and enter individual shared responsibility payment

The IRS has published Form 1040EZ instructions to help you fill out the form correctly.

 


Please note that the information contained in this document is designed to provide authoritative and accurate information, in regard to the subject matter covered. However, it is not provided as legal or tax advice and no representation is made as to the sufficiency for your specific company’s needs. This document should be reviewed by your legal counsel or tax consultant before use.

Additionally, the messages and content within the Pittsburgh Health Care Reform group do not reflect the advisory services of Henderson Brothers, Inc.