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Archive for Affordable Healthcare Act

It’s Time For A Mid-Year Premium Tax Credit Checkup

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If you have insurance through the Health Insurance Marketplace, you may be getting advance payments of the premium tax credit. These are paid directly to your insurance company to lower your monthly premium. Changes in your income or family size may affect your premium tax credit. If your circumstances have changed, the time is right for a mid-year checkup to see if you need to adjust the premium assistance you are receiving. You should report changes that have occurred since you signed up for your health insurance plan to your Marketplace as they occur.

Changes in circumstances that you should report to the Marketplace include:

• an increase or decrease in your income Read more

Beware of Draconian Penalties For Health Reimbursement Plans

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Beginning in 2015, large employers (those with 100 or more full-time equivalent employees) must begin offering health insurance coverage to their employees. Then, in 2016, employers with 50 or more equivalent full-time employees must do the same or face penalties, called the “large employer health coverage excise tax.”

Employers with fewer than 50 full-time equivalent employees are never required to offer their employees an insurance plan, but qualified small employers who do provide coverage may qualify for the small business health insurance credit.

In the past, many smaller employers have simply reimbursed their employees for the cost of insurance. They found it less expensive and had fewer administrative costs than having Read more

4 Thoughts About Supreme Court Premium Tax Credit Decision

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As we all know by now, the US Supreme Court upheld the government regulations that provide that an otherwise qualified individual who obtains health insurance through the federal exchange (rather than a state exchange) is entitled to a Premium Tax Credit (PTC). This is the 6/25/15 decision in King v Burwell. I think this is the logical ruling because the Act does provide that if a state doesn’t create an exchange, the Department of Health and Human Services (HHS) is to establish one. Also, since this is the “Affordable Care” Act we are talking about, the PTC is a key part that helps make insurance affordable for many who have household income at or below 400% of the federal poverty line (more so for younger people in regions where the cost of living is not high – not for all individuals).

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Changes Affecting your 2015 Premium Tax Credit

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If you have enrolled for health coverage through the Health Insurance Marketplace and receive advance payments of the premium tax credit in 2015, it is important that you report changes in circumstances, such as changes in your income or family size, to your Marketplace.

Advance payments of the premium tax credit provide financial assistance to help you pay for the insurance you buy through the Marketplace. Having at least some of your credit paid in advance directly to your insurance company will reduce the out-of-pocket cost of the health insurance premiums you’ll pay each month.

However, it is important to notify the Marketplace about changes in circumstances to allow Read more

Supreme Court, In A 6-3 Decision, Upholds Affordable Care Act (Obamacare) Subsidies

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Breaking: Supreme Court, in a 6-3 decision, upholds Affordable Care Act (Obamacare) subsidies. The ruling allows federal tax credits to be issued to people who buy health plans through a federally run ACA exchange.

 

 

 

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Five-Year Anniversary of Healthcare Reform: 5 Things You Should Know in ’15 About the ACA

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It has been five years since the Patient Protection and Affordable Care Act (the ACA) was signed into law. Healthcare reform has certainly been controversial, but this controversy does not absolve some businesses of certain responsibilities when it comes to offering minimum essential healthcare coverage to their employees.

In recognition of the five-year anniversary of healthcare reform, here are 5 things you should know about some of the key ACA requirements for businesses in 2015:

1. The shared responsibility provision of healthcare reform is effective either this year or next year, depending on how many employees you have. Also known as the employer mandate or “play or pay,” this provision requires companies with at least 50 full-time Read more

Tax Penalty For No Insurance Ratchets Up In 2015

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Article Highlights:

• Flat dollar amount penalty
• Percentage of income penalty
• Household income
• Modified adjusted gross income
• Tax filing threshold

The penalty for not having minimum essential health insurance for yourself and other members of your tax family takes a substantial jump in 2015. For 2014, the penalty was the greater of the flat dollar amount ($95 for each adult plus $47.50 for each child under Read more

IRA Contribution By April 15 May Prevent Paying Back Premium Tax Credit

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The Premium Tax Credit (PTC) for individuals who purchased health insurance on the Exchange (Marketplace) is an important tax break. As income goes up, this subsidy in the form of a refundable credit decreases. Then, it hits a cliff and completely disappears if one’s household income exceeds 400% of the Federal poverty line (FPL). This can result in a tax bill of thousands of dollars!

Here is an example. A married couple, both age 64, thought their 2014 income would be about $62,000. Being eligible for insurance on the Exchange, they purchased a policy and obtained a PTC of $14,112. When they file their return, they realize they actually have $63,000 of income for 2014. this is above 400% of the FPL so they must repay all of the $14,112 PTC! If they can drop their income to $62,040 (400% of the FPL for 2014), they Read more

Your Taxes And The Affordable Care Act

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Starting with this year’s filing season, taxpayers must report certain information related to health care coverage on their 2014 tax return when they file this April. In addition, taxpayers must provide proof of health insurance coverage or that they have received an exemption.

With that in mind, let’s take a look at how the Affordable Care Act might affect your tax situation, and based on your type of coverage, which new tax forms you might be receiving.

Tip: For additional information about IRS tax forms related to health care insurance, please see the article, Health Care Law: Changes to IRS Tax Forms, below.

Overview

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Another Affordable Care Act Oddity

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To help more people obtain health insurance, the Affordable Care Act (ACA) provides a subsidy in the form of a refundable, advanceable tax credit – the Premium Tax Credit (PTC). Generally, if your household income is at least 100% of the Federal poverty line, but not over 400% of that line, and you are not offered affordable coverage from your employer, you are eligible.

For many people, their household income is roughly the same each month. But not for everyone. Perhaps you started the year with monthly income within the eligibility range and obtained subsidized insurance for those months. But, then you get a better paying job or a bonus (but still no offer of affordable health insurance from your employer), and your annual household income goes above 400% of the FPL? Well, then you have to repay the Read more

Penalty Relief: Overpayment of ACA Tax Credits

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Beginning in 2014, an eligible individual or family member covered under a qualified health plan through a Health Insurance Marketplace (Exchange) is allowed a premium tax credit.

The premium tax credit offsets the cost of premiums paid for healthcare coverage in a qualified health plan. It is unusual in that taxpayers are able to take advantage of the credit in advance of filing an income tax return for the taxable year of coverage.

Advance credit payments are made directly to the insurance provider. The amount of the advance credit payments is determined when an individual enrolls in a qualified health plan through an Exchange and is based on projected household income and family Read more

Health Care Law: Changes to IRS Tax Forms

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This year, there are some changes to tax forms related to the Affordable Care Act. Along with several new lines on existing forms, there are also two new forms that need to be included with some tax returns.

While most taxpayers simply need to check a box on their tax return to indicate they had health coverage for all of 2014, there are new lines on Forms 1040, 1040A, and 1040EZ related to the health care law. Information about the new forms and updates to existing forms is summarized below

Form 8965, Health Coverage Exemptions

Complete this form to report a Marketplace-granted coverage exemption or claim an Read more

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