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Answers to 4 Questions About the Premium Tax Credit

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The premium tax credit (PTC) is a refundable credit that helps eligible individuals and families with low to moderate income afford health insurance purchased through a Health Insurance Marketplace. To get this credit, you must meet certain eligibility requirements and file a tax return.

Here are four questions the IRS is hearing from taxpayers along with the answers:

  1. What is included in the household income?  For purposes of the PTC, household income is the modified adjusted gross income (AGI) of you and your spouse if filing a joint return, plus the modified AGI of those individuals you claim as dependents who are filing a return only to claim a refund of withheld income tax.
  2. The IRS is asking to see my 1095-A. What should I do? You should follow the instructions on the correspondence that you received from the IRS. You may be asked for a copy of Form-1095-A in order to verify information that has been entered on your tax return. For more information about Form 1095-A and how to obtain one CLICK HERE.
  3. If I got advance payments of the PTC, do I have to file even if I never had a filing requirement before? Yes. If you received the benefit of advance payments of the premium tax credit, you must file a return to reconcile the amount of advance credit payments made on your behalf with the amount of your actual premium tax credit. You must file a return and submit Form 8962 for this purpose even if you are otherwise not required to file a return.
  4. Marketplace says I did not file, but I did file before the extended due date. What should I do? In advance of the open enrollment period that runs through January 31, 2016, the Marketplace sent Marketplace Open Enrollment and Annual Redetermination letters to individuals who might not have filed a tax return. Follow the instructions in the letter you received.
    • Log in to your Marketplace account to update your 2016 Marketplace application.
    • Check the box telling the Marketplace you reconciled your premium tax credits by filing a 2014 tax return and Form 8962.
    • Update your Marketplace application by December 15, 2015.
    • If you don’t update your Marketplace application, any help with costs you currently get will stop on December 31, 2015 and you’ll be responsible for the full upfront costs of your Marketplace plan and covered services.
    • For more help visit HealthCare.gov or call your Marketplace.