What you need to know about the Affordable Care Act and the Health Care Tax

Health Care TaxThe Affordable Care Act requires that you have minimum essential health coverage or make a shared responsibility payment, unless you’re exempt when it comes to the health care tax. On 2014 returns filed in 2015, taxpayers reported if they had minimum essential coverage; that reporting requirement will again be on your 2015 returns filed in 2016.

Before you can file your tax return you will need the form 1095 from the insurance company or the marketplace as proof of payment and coverage. Please keep an eye on your mailbox and look for these documents to bring to your tax appointment with us.

If you may be liable for a shared responsibility payment, carefully review the significant number and variety of exemptions available. You may also be able to project the amount of any payment. Closely related are changes to the medical expense deduction, health flexible spending arrangements (and similar arrangements), insurance coverage for children, and more.

Here are some Health Care Tax Tips

  1. While the information on these forms may help you complete your tax return, they are not needed to file. You can file your federal tax return even if you have not received one of these statements.
  2. If you received the benefit of advance payments of the premium tax credit, you must file a tax return to reconcile the amount of advance credit payments made on your behalf with the amount of your actual premium tax credit.  You must file a return and submit a Form 8962 for this purpose even if you are otherwise not required to file a return.
  3. For purposes of reporting by applicable large employers, minimum essential coverage means coverage under an employer-sponsored plan.Minimum essential coverage does not include fixed indemnity coverage, life insurance or dental or vision coverage.
    • Minimum essential coverage does include:
      Government-sponsored programs
      Employer sponsored coverage
      Individual market coverage
      Grandfathered plans
      Miscellaneous MEC
  4. If you enrolled in insurance coverage through the Health Insurance Marketplace, you are required to report changes to the Marketplace when they happen, like changes to your household income or family size, because they may affect your eligibility for the advance payments of the premium tax credits.
Patricia C. Forsythe E.A., CNSA
Enrolled to Practice before the Internal Revenue Service
Certified Notary Signing Agent (National Background Screened)
Notary, Mobile Notary


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