How do you report someone who lied about income to get on ObamaCare?


If a person reports income inaccurately on their Marketplace application in order to qualify for ObamaCare cost assistance that they don't deserve, their dishonesty will catch up to them when they file their tax return for the following year.  If they received more cost assistance than they were due, the excess will be owed back to the government when they file their taxes.

Meanwhile, reporting other information inaccurately generally has the same effect.

If you suspect someone of reporting income or information related to cost assistance to the IRS inaccurately, this is tax fraud. You should follow the directions on how to handle such a situation.

Keep in mind that the Affordable Care Act is a flexible program. Someone may report low income, because they expect to lose a source of income during the year, this is valid. Also realize that the ACA provides subsidies on claimed income. If a person is making money they aren't claiming, this is a whole other ball of wax. Likewise, enrollment can be confusing, and people may make honest mistakes.

Anyone who mistakingly misreported incorrect information or an inaccurate income to the marketplace, or to the IRS, should make a good faith attempt to get right and correct their information ASAP.

Generally, if someone simply reports income inaccurately, but tried to report honestly, the worst that will happen is that they will lose tax credits and owe back respective amounts up to the repayment limit of their income. You can't go to jail for making a mistake or not paying the fee... you can however get in serious trouble for purposeful tax fraud.

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Alejandro Espinoza on

Answer Rating:

Very helpful, thanks

Regina farley on

Answer Rating:

My aunt owns a home that she rents out . But its under her other married nMe . So she doesnt report it . So what can be done to her ? Her husban makes 1,330 a month plus she get 500 from the house she rents out see also takes her husbands medicine and sells it . Wbat can be done to stop this . Other ppl who really need it cant get it for liairs like her she owes 2 homes and 4 acers of property that isnt claimed

what the ____ on

How can people get by with saying , that they do not smoke and get cheaper insurance – obamacare When people smoke and do not lie about it on their insurance…what’s wrong with this……… on

Well, some things in life you attest to, and some things in life you have to account for. Being honest is about more than just doing the right thing. If you act like you don’t smoke, then go to the doctor for smoking related issues, you create a giant problem for yourself. I don’t consider that getting away with anything. I would never personally walk that dangerous tight-rope. The issue of tobacco in America is far beyond the bounds of the ACA, although it sure impacts it.

julie on

What about somebody that gets obamacare because they reported that they don’t qualify for insurance through their job but they really do? This person told me that she would rather pay the cheaper obamacare premium of $50 a month than our employers premium of $45 every two weeks.

Joe smo on

Have an employee who has not enrolled in health care coverage and has filed workmans comp. she allowed her personal insurance to lapse and now is not cover for the year 2016. Shouldn’t she be getting fined on

If a person has access to workers comp I believe they can opt for that rather than other coverage, if any coverage is lost for reasons other than non-payment then they have a 60 day window to switch to a marketplace plan. If a person doesn’t take advantage of the coverage options they have then they owe the fee on their taxes.

Tracy on

I know someone who doesn’t “work” and drives a $50,000 truck and owns many extras….How is it that I work and drive a very used vehicle and pay $500 a month for my insurance and don’t qualify? on

Well the logic is that the ACA is based on taxable income, so sometimes the Jones’ have money coming in off the books or used to have money but don’t have income. Its annoying, but gotta just focus on what is best for you and not what someone else is doing. If you think they have income they aren’t reporting you can always say something, but probably best not to dig too deep in the business of other private citizens.

Martha Nieman on

I enrolled in Obama Care and Chose an Ins. Co. called Phoenix Choice. I went on vacation in Colorado and was thrown from a horse. I went to the emergency room for treatment and have discovered that Phoenix Choice only covers me in Phoenix. It pays for nothing outside their network. My policy says it will only pay outside the network if you Go to the emergency room, which I did. I am being totally denied coverage I have payed for. This co. is taking advantage of the new system. I’m on a limited income. This is fraud and a rip off. Phoenix Choice needs to be investigated. Thank-you

[email protected] Erin on

Definitely find out what the appeals process is for your insurer for denied claims. Make sure your follow the process exactly and keep documentation. Also, call and inform the provider’s billing office (the emergency room) and tell them the situation. They may be able to offer additional documentation for the case and they will often arrange for payment to be due after you finish the appeals process.

If the insurer still refuses to cover the costs, consider getting legal representation (look for one that doesn’t charge unless you win the suit). Its complicated and frustrating, but often large institutions will try to take advantage of the fact that a legal battle will seem too daunting for the average person. However, the only way the law can be enforced is if people stand up for themselves and seek help when it is being broken.

Another option, which you can do at anytime, is try to contact the Arizona Insurance Commissioner’s office and ask for assistance or use their online consumer resources/file a complaint.

Stephen Young on

report it to your state office of the inspector general and to you state attorney general’s office. You ma also try your district attorney as well.

[email protected] Erin on

Thank you for adding. Another resource for how to solve disputes with private health insurers is your state’s Insurance Commissioner.

Peter on

Our school district offers medical insurance to its employees. There is a full time employee that uses the marketplace insurance at a much reduced nominal rate due to his LARGE number of kids and a wife that does not work. Why can he get the cheap rates and we have to pay the full price that our employer offers. How do we report that fraud?

Johnny Boston on

Hi. I was on a good plan the first year of marketplace insurances. They all lied just to make their commission last year. Also I couldn’t afford the prices of 2016. I used Northland Metro care of K.C.MO they helped me on Dr. Visits with my Dr. I been living in over draft at my bank. I’d be worse in the negative by using marketplace insurance benefits that wasn’t true. Northland Metro figured if I qualified and I did. Blue Cross backs them with Drs. Donating. Like last year Price goes up! I shouldn’t have to pay marketplace insurance cause of they’re lies. I will have to file exempt since one of the marketplace insurance took me off the enrollment last year. What can I do to get a price I can afford?

Chuck on

If person is on workmen comp pension which is tax free income of $55,000 annually and there not required to show this income bc its tax free so they get free insurance or is all income required even tax free state pension know person who says they don’t have report state pension bc tax free if this the case something needs changed bc that enough income they should be paying for insurance like the rest of us with this income for family of 2 people

JP on

You are wrong as to income will catch-up on tax return. I work in healthcare. My son who had to buy his own insurance as he gets only 1099 initially was giving United Community care. I had him call several times to correct the error, because I knew he did not belong in that bracket. For 2 years running he got enrollment paperwork for this insurance for no reason.
On the other hand, there are lots of people who don’t have income or have net loss on paper. They can have a million dollar house and still be on United Community Care. How is that fair!. Rich people get away with this kind of loop holes!

Ella on

Is there not a check system for couples claiming to be separated so the wife and children recieve free obamacare. Have a niece and her husband do it every year . He grosses 85,000 annually and his employer offers good coverage for the family resonable however it has copays and deductables . Then at the end of the year he claims married with 3 children to recieve all the tax perks he van recieve . Way i see it he could not claim married nor the children as dependents if they were claiming to be separated to revieve all the government perks and obamacare . Double milking the government and taxpayers .

Erin on

If his wife and children are actually able to enroll in a marketplace plan, it means they went through the effort of demonstrating that the employer is in fact not offering affordable coverage. However, individuals in a single family may also qualify individually for other insurances often mistakenly called “Obamacare” like Medicaid or CHIP even if the employer does offer the employee “affordable coverage” under the law.

Second, qualifying (or not qualifying) for one type of dependent tax credit doesn’t make you ineligible for other dependent tax credits. The dependent tax credits are or a variety of things including: childcare costs, early childhood education, medical expenses, and also just because having dependents is expensive. These credits are actually extremely complicated for divorced or separated parents to try and split up (see this page for more about that). In fact, we’ve heard from many parents (both married and non-married) who’ve been penalized on their year end taxes for mistakenly believing they were eligible for premium tax credits… because the system we have in the US is very confusing.

Needs help on

My exhusband and his wife are saying that they claim our son and put him on this insurance. I claim our son on taxes, my don lives with me and has visits every other weekend and holidays, the father does not pay child support . My questions is now the IRS wants a 1095 A form and of course my ex will not give it to me. Also how do I report them putting our son on this when they don’t claim him or support him?

Christina Knott on

I have custody of my half sister and the mother was court ordered to provide insurance. She signed the child up for Marketplace insurance stating that the child lived in her household. Now the IRS wants me to pay back the subsidy that the mother received for this child. Thousands of dollars. I have told the Marketplace that the child lived with me since she was first signed up and the Marketplace continued to ignore my court order. It’s been over a year of fighting this and I was just told to hire an attorney. Yea, with what money? And why is this my responsibility?

sam on

I want to know where to turn in the people I know who are getting obamacare fraudently. on

Can probably contact HHS or speak to the state medicaid department… but that said, it is near impossible to get ObamaCare fraudulently. You have to show you qualify for credits on your tax returns or you get stuck with a bill to repay subsidies. That said, assistance is based on income and not wealth. So if you see a person with money, they could have wealth and not income and could (fairly or not) be justified in taking upfront credits. In other words, make sure you understand all the data first.

Tom on

That’s not a true statement. You are going under the theory everyone works on the books or reports all thier income. That’s a falsehood. What people do and should do are on different ends of the spectrum. Quite frustrating when you work until you’re falling asleep, pay your taxes, pay crazy insurance increases and people earning 6 figures are reporting close to poverty because it’s a cash non-traceable industry. There are a lot of holes in this program that was intended for lower income people/ families and others found how to get over on the system. It’s a disgrace and an abuse. Something needs to be done. Audit F&B industries for example. If sales are 15K in a day and tips average 15-18% and server or bartender claims $50 for the day…I’d dig deeper, It’s common sense.

Ed Jones on

I know a person that lives in Fairbanks Alaska. He sold his business for 1/2 mil in the bank. He works primarily under the table and is using Obamacare.

Tom on

Is it true bartenders are not required to report cash tips in essence lowering thier gross salary and entitles them to ObamaCare? on

Bartenders are supposed to report their cash tips, they would thus be taxable, and they would thus count this toward the ACA. If they evade taxes by not paying tips, then that income doesn’t count toward the ACA if they don’t get caught… but they are also committing tax evasion which is pretty serious and wrong.

So essentially, no that is not true on-paper. In practice, its a question of individual responsibly.

Jessica on

My niece is married and her husband works… she signed up as not married and goes by her name before she got married. …my husband has been sick and we can’t get any help because we are both on Disability. I don’t thank it’s right for people to lie to get Insurance. I no they make more money then we do.

NOTE: This was edited to take out identifying information. on

We explain how to report suspected fraud here:

Robert Evans on

My wife and I are separted. Before we separated she applied for marketplace insurance after I had already purchased a policy for her. She is not reporting my income. How can I protect myself from her fraud? on

It depends on how you file. If you are filing separately, then this shouldn’t fall back on you (I would think, you’ll want to run this by a professional in terms of law and/or accounting).

That said, if you purchased a policy for her via the marketplace, this could certainly cause issues for you.

Situations like this where people are separated and not divorced can be particularly tricky. Thus, the go-to advice is to contact a professional who can give you clear direction.

Pat on

This isnt necessarily true. A married couple that lives together claims single on their tax returns so the wife appears to qualify for the obamacare premium tax credit. Husband fets insurance from his job. Wife qualifies based on her part time job income because she doesnt tell anyone theyre married. She also applies for food stamps based on her income. if they told the truth she wouldnt qualify for food stamps or a subsidy. Do you actually think the IRS is checking this out. Get real on

Um… committing tax fraud is risky business. Not getting caught might work for some people sometimes, but the IRS can come after you down the road. Not a good idea to mess with them.

Dee on

People lie all the time and get away with it even when you point the IRS in the right direction. They don’t care about the guy that hides 100k, F&B that deal in cash and hide most of it or bartenders/servers that earn 80k+ a year and report 12k etc.. They are after the big win. This is peanuts to them. No wonder we pay so much in taxes. 🙁

Mark E on

Amazes me, my company offers a qualified plan that is within the affordable guidelines and I still have employees that use the exchange since they can lie about their income and get the subsidies to reduce or eliminate their premium. All on my tax dollar and so far none have been caught. Kind of hard to explain to the majority that abide by the law that there is nothing the employer can do to report this.

Rich Pentico on

I have carried my wife and myself, on my employer-provided insurance, since I started working for this place, 3 years ago. I work for a large health-care consortium. My wife works for a small, less than 50 employee, firm.
My wife has hidden a great deal from me, including a cancer re-occurrence, with subsequent oral chemotherapy. The oral chemo has caused kidney failure to the point of needing dialysis. In the course of our separation, I asked how she was managing to have her health-care paid for. Her answer was something similiar to “I took insurance and Obamacare through my work.” I’d have to look, to see if this extended back into 2016, but I know that she signed up for coverage for 2017.
I am reasonably certain she filed our taxes, as married filing separately, for the last few years. I also wonder if she would have referred to herself by her maiden name, to obtain health-care benefits.
Where/what would be the first step in getting this investigated? on

There is no simple answer there to say the least, the simplest would be her coming clean with you so you could better understand your responsibilities in terms of filing, but barring that you have the potential problem of needing personal information about another person. I’m not sure the best way to go about this, but contacting and the IRS for direction seems like a good start.

It is valid for her to file as married filing separately, but depending on specifics there could be issues with the way she is filing for you (and thus there could be something important for you to know about). Good luck, going to the official sources and professionals is the right call here if you can’t open a proper line of communication with her.

Carl Rice on

I know a woman who has dual citizenship( or a green card) for the U.S. and India. She claims poverty, but is a millionaire in India. This allows her to receive health coverage for less than a 100.00 a month. This is clearly fraud. How do I report this?
Carl rice on

Its not fraud unless she has income in India that would be reported in some way in the United States. U.S. tax credits are based on taxable income, not wealth. You can however call and make them aware if you choose.

lynn on

how can i report someone tht has committed Obama care fraud

Feed up with people that work the system. on

There is a young lady who is divorce. She gets 4000.00 a month in child support and ownes a duplex and several business which brings in an income. She is a professional but doesn’t work although she has had many job offers that have medical benefits. She has turned down many offers of employment because she doesn’t want to work. She says if she works and makes a certain amount of money she will lose her Obamacare. Plus she brags that she can live a good life, has no money problems and can stay home with her children that she only has 50% of the time and get free heath care.
You tell me why it’s ok to refuse work with medical benefits and get government assistance for health care that the rest of us working tax payers are paying for. It’s not right and an injustice to all of us tax payers who are working our tails off to make ends meet.
She can afford to take vacations and reap the benefits that most of us working people can’t, then brag that she gets free health care.
There needs to be better monitoring, if a person is capable of employment they should work and pay for their health care just like us working people do.
My taxes should not be benefiting lazy people that work the system. on

She has an income, she has capital income from her ownership of capital and from her child support.

There are many people in the world with capital income who don’t otherwise work.

So that is one part of the equation, and we can be mad about it or not.

On the other end, she is still coming in with a low enough income to get assistance, and she is taking advantage of it.

This is frustrating. However, for every person like this, there is the family she supports who are innocent and there are hard working Americans who just don’t earn enough.

There isn’t a lot of cost effective ways to take away assistance from a person like this while ensuring it to those who need it.

If it makes you feel better, a very small portion of your tax dollars go to people like these.

There are people who drive drunk, I don’t want them driving on tax funded roads… but unless we catch them committing a crime there is nothing we can do. Letting the roads crumble won’t solve the issue. Although it is an issue worth caring about.

I guess the answer is just not to focus on what other people are doing and focus instead on what we are doing. Also, in some states they have work requirements. That would stop her, but it would also stop those who can’t work for good reasons. Slippery slope.

Ultimately though, even the least admirable among us we probably wouldn’t want to refuse care to if they were sitting in front of us suffering, so really a lot to think about here.

emily on

X has 3 oboma phones on

Report abuse of the lifeline program to the FCC:

K B on

I want to know about Medical Offices defrauding us for our insurance, making appointments, doing exams, and never doing any real work to help us. We get referral after referral after referral. I’m given numbers and said they can help, I call and they can’t when they find out what insurance I have. I have been referred to office after office every office I call… I was forced to sign up for Obama care and now I can’t get any care, and there is no pay option.. on

I’m not sure I fully understand the comment?

Jesus Ericson on

The hyperlink is broken and not leading anywhere in the sentence:
You should follow the directions on how to handle such a situation.

There is no 2nd or other direction or method to report the abuse of reporting false income or information related to cost assistance under obamacare on

Just made sure the link was up-to-date. Here is the deal with ACA tax credits, they are tax credits requested in advance based on expectations of how you’ll file for the year. When it comes time to file, you either have to tell the truth or not. If you tell the truth on your taxes, you have not committed fraud on your taxes (but if you were wrong about something, you may owe back money).

As for lying in the first place, in a way that is provable, I would think you can still use this same resource, but if you are unsure why not contact or the IRS directly and ask them?

Here is why this is tricky though, if you think “but I know this person is actually making X, but they say they will make Y”…. well that is hard to know for sure in advance, so it would be hard to prove the person is lying until they file.

If they are lying about something like marriage status or children or a job, that may be provable, but there are even some complications there with the status of most of those things in terms of filing being subject to change in a year.

When in doubt, file the form or call the IRS or marketplace is I think the best bet though.

Margaret Smith on

The person is a resident alien, although divorced. He receives FREE ACA insurance. Has Fidelis Care and NYS Medicaid. He does not work, nor has never held a job that he used his SS number. He has a checking account at M&T and has a VISA credit card from Bangkok Bank in Thailand. He uses it to by iPads, IPhone, his monthly wine purchase, Walmart, SAMS, even a new motor for a car – etc. This to me is disposable income. He has no housing or utilities to pay.

How can Fidelis Care and NYS allow this to happen? Why are the tax payer’s paying his way? He was in hospital for 10 days due to COVID and that will be payed by the taxpayers too. on

Medicaid has no requirement of what someone does with their money, it only requires that a resident of the state of New York, a U.S. national, citizen, permanent resident, or legal alien, in need of health care/insurance assistance, whose financial situation would be characterized as low income or very low income (there are then specific levels of income). If he is making less than that income, what he spends it on isn’t in the rules. The limit is $17,775 for 2021 for an individual (see here

If he is making more income than that and not reporting it, that could be an issue, but he would still qualify for assistance on marketplace coverage.

Assistance is based on income and being legally present though, not what people do with the income. That is the answer.

Monica R on

A friend of mine pays $500/mo ACA premiums for his adult daughter who has a chronic illness for 6 years & hasn’t worked for the last 3 years or so. She hasn’t filed tax returns for awhile. Her illness also requires expensive pain management treatments that aren’t covered by insurance. She renews her coverage each year but he has no access to her application so he doesn’t know how she qualifies. She just gives him the bill to pay. He’s retired and a disabled veteran so I worry about how he can afford to keep paying for all her expenses. Isn’t this an example of ACA fraud? It apparently hasn’t been detected so far. on

Well, she needs to call her state marketplace and have them find her account. There are many ways to verify. Who is the insurer, call them. Otherwise, you have to call Medicare, Medicaid, and the Marketplace and track down that coverage.

When you pay $500 for coverage, when you use coverage, there is an insurer. The insurer can help you figure it all out.

That is the first step. Unclear from the information present if it is fraud. But it also seems like a family thing to work out for the family.

Barbara Fellinger on

2016 I request Blue cross Blue shield as my Insurance hold not Obamacare when I call for Insurance . They told me it was not obamacare and I this was regular Health Insurance Like my Blue cross blue shield I had the year before..again not Obamacare then when I file my taxes they said that was obamacre. The when I called them they said, ” They were told to get enrollment at any cost so they said, yes they lied and I have a tax Liability. I have a letter saying that for 2016. I have been paying and I talked to one IRS agent to see if they can reverse the Tax Liablity so I have been calling and sending letter is there a form. If so please send. I am 70 years old to old for this and shame on the government.