Tax Credits and Changes to Income

Tax credits are based on annual household income, not monthly income. If projected annual income changes you can adjust cost assistance to avoid repayment. Quick Facts on Cost Assistance and Changes to Income There are three important things to understand about cost assistance and changes to income: Marketplace cost assistance is based on projected annual household income,…

Why Do I Owe the ObamaCare Penalty?

Generally someone owes the penalty if they didn’t have coverage or an exemption for a month, however they can also owe money back if they owe back premium tax credits due to making more income

Do I Owe Back Tax Credits if I Lose Income?

Generally you can only owe back tax credits if you gain income, not if you lose income. So if you go from Marketplace to Medicaid and claim under 100% of the Federal Poverty level you’ll owe back nothing.

Impact of Lump Sum Settlement on Obamacare Subsidy

Lump-sum income is counted for the month for Medicaid and Medicare, but for ACA subsidies we believe it counts as annual. Think the confusion comes from the fact that it works different for Medicaid and Medicare.

Total Household Income on Form 8962

Dependent’s AGI is something to keep in mind when claiming credits on form 8962, a dependent can throw off household income and really mess with repayments and tax refunds.

Can I Retroactively Get HealthCare Subsidies?

If you have a Marketplace health plan you can retroactively get subsidies, if your income fluctuates consider taking only partial credits upfront or none at all, also if you get a Silver plan you can adjust cost sharing amounts throughout the year at no extra cost.

Can I Get Help For Withheld Tax Refund?

All the best information we have about 1095-A’s discusses how to get the form filed, at that point it’s up to the IRS. We can only imagine they are working hard to get everything flowing smoothly. You can always call them to follow-up or get assistance from TAS (tax payer advocate services).

How to Project Income for ACA if Income Varies?

If your income varies from week-to-week you’ll make a reasonable prediction of your annual income, which you can base on last year. You should consider taking only part of the tax credit up front and then adjusting the net tax credit on the 8962 – Premium tax credit form at the end of the year.