It is the start of a new year and you are expecting to file your tax return for the previous year of 2017. While this is all well and good, there are forms that were released that require your attention. These are the health coverage tax forms, comprised of Form 1095-A, Form 1095-B, and Form 1095-C. These tax forms are crucial healthcare forms that you need to keep an eye on whilst you file your tax returns. What do these forms mean exactly? What do they do? As it stands, you may have some questions about these forms. While they may seem confusing, they are actually rather easy to understand. Here are the facts.
Form 1095-A is your Health Insurance Marketplace Statement. The Health Insurance Marketplace, or Marketplace for short, sends this form to those who are covered by them. Essentially, they are sent to individuals enrolled with them or family members who were enrolled with them from someone else. It provides some information on your Marketplace coverage and is a crucial component to filling out Form 8962, which is needed for premium tax credit. They decide whether you need to claim premium tax credit for your tax returns or reconcile advance payments for the premium tax credit. This form also helps you figure out if you and your family members have coverage that satisfies the individual shared responsibility provision. This form is supposed to be sent out by January 31, 2018 by the Marketplace, so keep an eye out for it. This form is essential for filing your tax returns.
Form 1095-B is your Health Coverage. These are provided by health insurance providers that do not fall under the Marketplace or certain employers with 50 or more employees working for them. It provides information on your health coverage by these health insurance providers and also helps you figure out if you and your family members have health coverage that satisfies the individual shared responsibility provision, much like Form 1095-A. The deadline for this to be sent out has been extended to March 2, 2018 and although this form will help with filing out your tax returns, it is not required.
Form 1095-C is your Employer-provided Health Insurance Offer and Coverage. Only certain employers can send out this form, namely applicable large employers. These large employers need to have over 50 employees working under them in order to be applicable. Another requirement for this form is that you have been working for this large employer full-time for at least a month, or if you enrolled into the employer’s self-insured health plan. The latter extends to part-time employees as well. Form 1095-C provides information on the health coverage offered by your employer and, sometimes, information about whether or not you enrolled in their coverage. This form can help you determine if you are eligible for the premium tax credit. This form also gives information on whether or not you and your family members are enrolled in certain kinds of coverage offered to you by the employer. This is called self-insured coverage. The deadline for Form 1095-C has also been extended to March 2, 2018 and though this form will help filing your tax returns, it is not necessarily required.
These health coverage tax forms provide information on your health coverage during the previous year. All of them are used to determine if you and your family members had health coverage for the entire year or what months you did have health coverage should you have not taken it for a full year. As these forms do not need to be sent out along with your tax return, you can store them with your tax records to have evidence in case you need to assure people that you have the necessary forms.
Relation to Tax Returns
For those enrolled through the Marketplace, Form 1095-A is essential for filling out and completing Form 8962. This form is used to reconcile any advance payments of the premium tax credit or claim the premium tax credit. Form 8962 is crucially needed to file a tax return. Some information on Form 1095-C can be used to determine whether or not you qualify for a premium tax credit. However, it is not essential for filing a tax return and neither Form 1095-B or 1095-C are required to fill out an individual tax income return.
If you have received a Form 1095-A and it shows that the advance payments of the premium tax credit were paid for coverage, you basically need to file a tax return. As such, Form 8962 is used to reconcile those advance payments and claim premium tax credit, even if there are no advance payments for the premium tax credit. If you have received Form 1095-B or Form 1095-C, it is not required to fill out a tax return.
The ACA tax filing requirements are used to determine whether you need to file a tax return. If you enrolled in the coverage provided by the Marketplace, you must file a tax return and reconcile any advance payments of the premium tax credit. If you have a filing requirement and everyone in your family had coverage for an entire year, check the full-year coverage box on your tax return. And finally, if you or your family members did not have coverage for the entire year, you need to claim any applicable coverage exemption or make and individual shared responsibility payment.