What you should know about Obamacare and taxes

The Affordable Care Act has provided for expanded coverage for many residents.  It has also created new considerations and a new component to tax filing.  For residents who bought their insurance through a public exchange, Access Health CT in Connecticut, there are some things that you should be aware of.  The CT Mirror has just published an article with information that will help you understand what is going on.

It is through your tax filing that the government will confirm whether you purchased health insurance— and you will pay a penalty if you didn’t.  A new IRS form, the 1095, will be sent to you by your exchange and should be received in the beginning of February.  In CT, 3600 recipients will not get their form due to a problem that the exchange ran into, and for them, the forms are expected to be received by the end of February.  This form will provide you with the information that you need to complete Form 8962 – which you will now file with your return if you received premium assistance through advance credit payments (whether or not you otherwise are required to file a tax return) or if you want to claim the premium tax credit when you file your return.

There are things that some residents may not have clearly understood when they applied for insurance through the exchange.  Did you know that the subsidies that many residents received are tax credits that were paid in advance?  The amount is based on a person’s income, so when you file your taxes, you will be reconciling the credit with your income.  It may balance out.  However, you may get a refund or you may actually have to pay some back.

For more information and a more detailed explanation of what you should know, read more in the CT Mirror article, Six things to know about Obamacare and taxes.