Jeffrey Wade
When it comes to filing income taxes, individuals may be required to provide proof of health insurance coverage. While it is not mandatory to submit proof of health insurance with your tax return, it is advisable to retain relevant documentation, such as Form 1095, for reference and record-keeping. Form 1095 comes in three variants: 1095-A, 1095-B, and 1095-C, each providing information about health care coverage, who was covered, and when. These forms are typically sent by health insurance providers or employers, and they can assist in determining eligibility for premium tax credits or subsidies. It is important to note that these forms should not be attached to your tax return, but they can help in completing Form 8962, which calculates the final amount of premium tax credits an individual qualifies for.
| Characteristics | Values |
|---|---|
| Whether to send proof of health insurance to the IRS | You are not required to send proof of health insurance to the IRS. |
| Whether to attach proof of health insurance to tax return | You should not attach proof of health insurance to your tax return. |
| Whether to keep proof of health insurance with tax records | Yes, keep proof of health insurance with your tax records. |
| How to obtain proof of health insurance | You can obtain proof of health insurance from your insurance provider or your state Marketplace website. |
| Forms of proof of health insurance | Forms 1095-A, 1095-B, and 1095-C are used as proof of health insurance. |
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What You'll Learn
Form 1095-A as proof of health insurance
Form 1095-A is a Health Insurance Marketplace Statement that provides information about an individual's health care coverage. It is used to prove that an individual has health insurance and contains details such as who was covered and when. This form is typically sent to individuals who enrolled in a qualified health plan through the Health Insurance Marketplace.
The annual deadline for the Marketplace to provide Form 1095-A is January 31, and individuals are advised to wait for this form before filing their income tax returns. While attaching Form 1095-A to the tax return is not necessary, it is important to have it on hand to assist in completing Form 8962, Premium Tax Credit. This form helps individuals reconcile their advance credit payments with the premium tax credit they are allowed, which can impact their refund amount.
Form 1095-A is particularly relevant for those who received health insurance discounts or subsidies, as it outlines the monthly subsidies received to lower the cost of the health insurance plan. By comparing the premium tax credits received with the total amount one is eligible for based on their income, individuals can determine if they need to pay more or if they are owed a refund.
It is important to note that Form 1095-A is only provided for health insurance plans that are Bronze level or above. Catastrophic health plans and dental plans do not fall under this category. Additionally, individuals have up to two years to file their Form 1095-A with their taxes.
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Form 1095-B as proof of health coverage
Form 1095-B is a form used to report information to the IRS and to taxpayers about individuals who are covered by minimum essential coverage and are therefore not liable for the individual shared responsibility payment. This form is sent by health insurance providers to individuals they cover, with information about who was covered and when.
For tax years before 2020, Form 1095-B could be used to find out whether you and your family members had health coverage that satisfied the individual shared responsibility provision. However, it is important to note that you do not need to attach Form 1095-B to your tax return. In fact, you may not even receive this form by the time you are ready to file your tax return.
While Form 1095-B is not required for your federal or state tax return, it is recommended to keep it with your tax records. This is in case you are asked to provide proof of your health care coverage. For example, you may be required to show this form to a tax preparer, along with your other tax information.
In summary, Form 1095-B serves as proof of health coverage and can be used to demonstrate that you are not liable for the individual shared responsibility payment. While it is not mandatory to include this form with your tax return, it is advisable to keep it on hand for reference and to assist in preparing your tax return.
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Form 1095-C as proof of employer-provided coverage
Form 1095-C is a tax form sent to certain employees of large employers. Large employers are those with 50 or more full-time employees. It contains information about the health coverage offered by your employer in a given tax year.
Form 1095-C is not filed with your tax return. Instead, you should keep a copy of the form with your tax records for future reference. You do not need Form 1095-C to file your tax return, but the information it contains can assist in determining your eligibility for the premium tax credit.
Form 1095-C is sent to any full-time employee of an Applicable Large Employer (ALE) member who has been employed full-time for one or more months of the calendar year. ALE members must report this information for all twelve months of the calendar year for each employee.
The deadline for employers to provide Form 1095-C to individuals is January 31. However, you do not need to wait for Form 1095-C in order to file your tax return. You can prepare and file your return using other information about your health insurance.
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Form 8962 to calculate premium tax credits
Form 8962 is used to calculate the Premium Tax Credit (PTC) and reconcile it with any Advance Premium Tax Credit (APTC) that has been received. This form helps eligible taxpayers claim the premium tax credit, which lowers the cost of health insurance.
To complete Form 8962, you will need to provide your name, Social Security number (SSN), household income, tax family size, and modified adjusted gross income (MAGI) from your Form 1040. Your tax family generally includes you, your spouse (if filing a joint return), and your dependents. You must include all of your family's or household's income.
The next step is to calculate your household income as a percentage of the federal poverty line (FPL) using the IRS instructions. This will help determine your eligibility for the PTC and the amount of credit you can claim. The federal poverty line (FPL) is a measure of income used to determine eligibility criteria for specific programs and benefits, including the PTC.
After determining your eligibility and the amount of credit, you can choose how to claim it: as a credit to reduce your monthly payments on your health insurance premiums or as a credit to reduce your taxes on your return. If you choose the monthly payments option, the government will pay your insurer over the course of the year, lowering your monthly premium costs.
It is important to note that if you received more APTC than your PTC, you may need to repay the excess APTC, subject to certain limitations. On the other hand, if your household income was lower than estimated, you may qualify for additional PTC, potentially resulting in a higher tax refund.
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No need to send proof of health coverage to the IRS
If you are a US citizen, you are not required to send the IRS information forms or other proof of health care coverage when filing your tax return. However, it is a good idea to keep these records on hand. You may receive multiple information forms that you can use to complete your tax return and will keep with your tax records.
If you enrolled in coverage through the Marketplace, you will need the information on Form 1095-A to complete Form 8962 to reconcile any advance payments of the premium tax credit or claim the premium tax credit, and to file a complete and accurate tax return. Form 1095-A is the only one of the three types of 1095s with information about discounts that most people with a marketplace plan get on their health insurance bill, called premium tax credits or subsidies. If you got these health insurance discounts, you'll need your 1095-A to fill out your income tax return.
For tax years other than 2020, if advance payments of the premium tax credit (APTC) were made for your or a member of your tax family's health insurance coverage through the Health Insurance Marketplace, you must complete Form 8962, Premium Tax Credit (PTC), and attach it to your return. Your tax family consists of every individual you claim on your tax return – yourself, your spouse if filing jointly, and your dependents. You will receive Form 1095-A, Health Insurance Marketplace Statement, which provides you with information about your health care coverage. You should wait to file your income tax return until you receive that form.
You might receive a corrected or voided Form 1095-A because the information on the initial form was incorrect or incomplete. For more information on what you need to do with a corrected or voided Form 1095-A, see Corrected, Incorrect or Voided Forms 1095-A. This information can help you assess whether you should file an amended tax return.
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Frequently asked questions
Form 1095-A is a Health Insurance Marketplace Statement that provides information about your health care coverage. It is sent by the Marketplace to individuals who enrolled in coverage there.
No, you do not need to send Form 1095-A with your tax returns. However, it is recommended to keep it with your tax records for reference.
Form 1095-A is typically sent by the Marketplace to individuals who enrolled in coverage. You can also go to HealthCare.gov or your state Marketplace website and log into your Marketplace account, or call your Marketplace call center to obtain a copy.
