IRS Premium Tax Credit
Form #8962
is used to reconcile the APTC Advance Premium Tax Credit
subsidy with your IRS # 1040.
If you got too high a subsidy or too low, it gets reconciled at tax time on form 8962. Scroll down or click icon on your right to get the form from the IRS website. If your subsidies were too high you may have to pay penalties, if too low, you can get a tax refund or lower the amount you have to pay. In a lot of ways, IMHO subsidies are hocus pocus, jiggery pokery – smoke and mirrors as it’s all guesswork and promises.
Form 8962 Premium Tax Credit
Reconciliation Form attaches to 1040
Subsidy is IMHO hocus pocus - smoke & mirrors
it all comes out when you file taxes!
Our webpage on Form 8962 - Premium Tax Credit Subsidy Reconciliation
More Instructions
See form 2210 Underpayment of tax and the instructions for more details.
Form # 8962 Instructions HTML * pdf *
but first you need the Proof of Coverage Form 1095 A from Covered CA
and B if applicable – like if you had Covered CA part of the year and other coverage the rest of the year, from an Insurance Company, Government – Like Medicare or Medi-Cal or your Employer.
When you are done completing # 8962, enter the calculation on line 46 and/or 69 of 1040 form.
Schedule 1 Additional Income & Adjustments to Income
Do you think this process is complicated?
Line 8b Adjusted Gross income then add line 2a, 5a &
to get Covered CA MAGI Income
2019 Schedule 1 Additional Income & Adjustments to Income
IRS Form 8962 Premium Tax Credit
Reconcile your subsidy with your actual income
Instructions
How to fill out 8962 Video
VIDEO What is APTC Advance Premium Tax Credit
Interactive Tax Assistant (ITA)
Am I eligible to claim the Premium Tax Credit?
Tax Estimators
- turbotax.com
- H & R Block
- Efile.com
- Estimate the Subsidy for Health Insurance, benefits, premiums, etc.
- 8962 ONLINE Calculator
- TaxFormCalculator.com
- etax.com
ACA What You Need To Know #5187 
Health Net VIDEO
How to get subsidies – pay less for coverage
InsuBuy International Medical Coverage – Instant Quotes & Enrollment
Tax Return Deadline
H & R Block advises to file a return and reconcile your credit by April 18, or request an extension so you have more time to file your taxes. An extension will give you until October 17 to file your return and reconcile any credit you received through Covered CA
Will I have to file a federal income tax return to get the premium tax credit?
Yes. For any tax year, if you have APTC in any amount or you do not have APTC but you plan to claim the premium tax credit, you must file a Form 8962, and attach it to your federal income tax return for that year. If you have any APTC, you will use Form 8962 to reconcile the difference between the APTC made on your behalf and the actual amount of the credit that you may claim on your return. This filing requirement applies whether or not you would otherwise be required to file a return.
If APTC is made on behalf of you or an individual in your family, and you do not file a tax return, you will not be eligible for APTC or cost-sharing reductions to help pay for your Marketplace health insurance coverage in future years. This means that you will be responsible for the full cost of your monthly premiums. IRS.gov
CFR 155.305 (f) (4)
Eligibility Standards
Compliance with filing requirement.
(i) Covered CA may not determine a tax filer eligible for advance payments of the premium tax credit if HHS notifies the Exchange as part of the process described in § 155.320(c)(3) that advance payments of the premium tax credit were made on behalf of the tax filer or either spouse if the tax filer is a married couple for a year for which tax data would be utilized for verification of household income and family size in accordance with § 155.320(c)(1)(i), and the tax filer or his or her spouse did not comply with the requirement to file an income tax return for that year as required by 26 U.S.C. 6011, 6012, and implementing regulations and reconcile the advance payments of the premium tax credit for that period.
(ii) Notwithstanding the requirement in paragraph (f)(4)(i) of this section, the Exchange may not deny eligibility for advance payments of the premium tax credit under paragraph (f)(4)(i) of this section unless direct notification is first sent to the tax filer, consistent with thestandards set forth in § 155.230, that his or her eligibility will be discontinued as a result of the tax filer‘s failure to comply with the requirement specified under paragraph (f)(4)(i) of this section.
Can we fax forms #1095 & #8962
if we didn’t get the letter
Fax the forms to where?
What letter?
You can get free tax advice here.
I meant,I already filed. They said a 12c was sent out, but I’m no longer at address, so I didn’t get it. ive already printed out 1095 and downloaded an 8962 form ,can I fax it without the irs letter
Tax Tip 2106-3 states that you need to send the letter. Since you don’t have it, sure try sending without the letter.
I didn’t make changes to my subsidy amounts, income, family filing status, dependents, etc. due to illness.
What is the criteria to get an exemption and fix the issues now?
ACCEPTED:
Fear of IRS.
Taxpayer who had been laid off was overwhelmed by Schedule C instructions. As a result he just shut down and stopped filing for several years as the fear and anxiety mounted. He hired a CPA (Weston) to get his books in order. Once all returns were filed and taxes assessed, the IRS abated all penalties, because they agreed that the taxpayer had no malicious intent.
Health issues.
Prolonged illness made it difficult to concentrate, and short-term memory suffered.
Mourning.
Grief due to death of a close family member.
Burglary.
House was robbed and family computer with all records was stolen
ONE FREE PASS:
But before taxpayers go groveling with excuses, they have another, guilt-free option: the first-time penalty abatement waiver. Apparently the IRS has a warm and fuzzy side, because it believes that everyone is entitled to one mistake. So if you’ve got a clean record — you’ve filed (or filed a valid extension for) all required returns and are all paid up — you can qualify for the FTA waiver.
USA Today
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Reasonable Cause
The key word here is “reasonable,” and it doesn’t include, “I forgot.” If you ask for a waiver for reasonable cause, you need to establish the facts for the issue you are having that keeps you from taking care of your taxes, and you need to produce documentation to back it up.
Fire, natural disaster, casualty, or other serious disturbances count as reasonable cause. Plenty of people in the U.S. have been hit with extreme weather, devastating forest fires, and other issues over the past year or so. If your home or business is in a riot zone, you may receive a waiver since having your structure blocked off by police tape is probably considered a pretty serious disturbance.
If you are unable to obtain your records, the IRS may grant a waiver.
Death, serious illness, incapacitation, or unavoidable absence of you, the taxpayer, or a member of your immediate family is considered reasonable cause. It’s pretty cool of the government to acknowledge that dead people would have a tough time taking care of their taxes.
Other reasons establishing you used all “ordinary business care and prudence” to meet your Federal tax obligations but just couldn’t do it. “I forgot” does not, unfortunately, count as reasonable care and prudence. Neither does lack of funds unless the reason for the lack meets reasonable cause criteria.
Top Tax Defenders.com
IRS Website on Penalty Relief due to Reasonable Cause
OK, that might work for the IRS, but do you have a more specific citation for Covered CA?
Enrollee’s Duty to report changes
I can’t come up with the money!!! What can I do?
If your MAGI is below 400% of the federal poverty level, there is a cap on the amount you must pay back, even if you received more in assistance than the amount of the cap. However, at higher income levels you’ll have to pay back the entire amount you received, which could be a lot. Our page on maximum pay back. 8962 Instructions – Payback limitations
you have until the due date of your return (April 15 plus extensions) to make a traditional IRA contribution and deduct the amount from your taxes. Likewise for contributions to a 401(k), SEP-IRA, SIMPLE Plan, or other tax qualified retirement plan for the self-employed. You also have until the due date of your return to make a contribution to a health savings account. Moreover, you have until the due date of your return to establish a traditional IRA or SEP-IRA account if you don’t already have it.
Nolo – what to do if you owe subsidy repayments?
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CA Couple must pay back $13k in Advance Subsidies
They said in their U.S. Tax Court filing that they had been told by Covered California marketplace representatives that they qualified for subsidy assisted insurance coverage.
If they had known that was not the case, the Walkers said they would not have purchased insurance they did.
The Tax Court took that into account, noting in the decision:
“We note that it appears that Covered California may have incorrectly informed petitioners that they were eligible for the APTC for 2014. We are not unsympathetic to petitioners’ plight; however, we are bound by the statute as written and the accompanying regulations when consistent therewith. … The simple facts are that petitioners’ MAGI exceeded eligible levels and that they must repay the APTC payments made on their behalf.”
Don’t mess with taxes.com
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https://insuremekevin.com/irs-underpayment-payment-penalty-triggered-with-obamacare-subsidy-repayment/
https://insuremekevin.com/13000-tax-bill-triggered-covered-california-income-advice/
https://insuremekevin.com/download/covered_california/1095_A/Polk_Covered_CA_decision.pdf
Do you have a citation that shows I can make an IRA contribution even if I file late – extension?
I’m glad you asked that question. One can’t trust everything on the Internet! Even if NOLO said it. Here’s what IRS Publication 590A says:
Contributions must be made by due date.
Contributions can be made to your traditional IRA for a year at any time during the year or by the due date for filing your return for that year, not including extensions. For most people, this means that contributions for 2018 must be made by April 15, 2019 (April 17, 2019, if you live in Maine or Massachusetts).
One of the problems was that our child moved out, got a good job and filed his own taxes. Is there a way we can fix that on our tax return?
Looks like you can. Double check with your CPA or tax counsel. Check this out from Quicken – Intuit.
form 8962 for the agi, do I include va disability?
The IRS Website on VA Disability Benefits states that benefits do not count as income.
The definition of MAGI Income for Subsidies of taking line 37 of your 1040 and adding back in Social Security, Foreign Income and Tax Exempt Interest doesn’t mention VA benefits, so the answer would be no.