How Obamacare Might Impact Your Federal Income Taxes

With the tax season upon us, CDPHP^® is reminding you that the Affordable Care Act (ACA), or Obamacare, may impact your 2014 tax returns.

The individual mandate, a key provision of the ACA, requires most Americans to purchase health care coverage or pay a penalty. Those who did not have health insurance for three or more months last year, and did not qualify for an exemption, may have to pay this fine. This year the penalty is $95 per adult and $47.50 per child (up to $285 per family) or 1 percent of household income, whichever is greater.

If you purchased health care coverage through the online marketplace, you should receive Form 1095-A in the mail by early February. If you do not receive the form, you can download a copy from your personal account at NY State of Health^TM. Keep this form with your other tax documents. Information from Form 1095-A will be used to complete your tax return.

If you qualified for premium tax credits when enrolling in the online marketplace, the final amount of your tax credit will be calculated when you file your return. If you’re using software to complete your taxes, this amount will be automatically calculated. If you file by mail, you will be required to attach the Premium Tax Credit Form (Form 8962) to your return.

Please note that if the amount of money you earned in 2014 is different from what you reported when enrolling in coverage, you will either be required to pay the difference or will receive credit.

For additional information on how the ACA might affect your federal tax returns, visit the IRS’s Health Care Law: What’s New for Individuals and Families.

Photo by Philip Taylor / CC BY