You generally don’t have a Tax Penalty to pay back… as long you comply with the 30 day requirement of notifying Covered CA of Income Changes of more than a 10% Covered CA FAQ Tax FAQ , but you may have to report the credits as income! FAQ 114 8962 Instructions (Repayment of Excess Advance Premium Tax Credit) Covered CA is trying by sending out the 2015 Income Reconciliation. Please note that the statements made to Covered CA about MAGI income are under penalty of perjury.
Read below, the Federal Law is on YOUR side!
U.S. residents who did not qualify for Medicaid but whose estimated incomes qualified them for federal subsidies will not need to repay the subsidy if their actual incomes fall below the federal poverty level, Kaiser Health News reports. CA Health Line 10.17.2014 ♦ 1.36b-2 ♦ FAQ’s
The proposed regulation provides that a taxpayer is not required to repay any portion of the advance payment if a family ends the year with household income below 100% of FPL after having received advance payments based on an initial Exchange determination of ineligibility for Medicaid. Tax Credit Fact Sheet
What happens when someone who lives in a state that has expanded Medicaid receives advance payments of premium tax credits, but her actual income ends up being 125 percent of the poverty line, which would have made her eligible for Medicaid? Does she have to pay the advance payments back when she files her taxes?
No. She would still be considered eligible for premium tax credits because the Marketplace found she was not eligible for Medicaid based on her estimated income, and her final income is between 100 and 400 percent of the poverty line, which is within the eligibility range for premium tax credits. Health Reform Beyond the Basics
Example 5. Determination of Medicaid ineligibility. In November 2014, Taxpayer G applies through the Exchange to enroll in health coverage for 2015. The Exchange determines that G is not eligible for Medicaid and estimates that G’s household income will be 140 percent of the Federal poverty line for G’s family size for purposes of determining advance credit payments. G enrolls in a qualified health plan and begins receiving advance credit payments. G experiences a reduction in household income during the year and his household income for 2015 is 130 percent of the Federal poverty line (within the Medicaid income threshold). However, under paragraph (c)(2)(v) of this section, G is treated as not eligible for Medicaid for 2015. 26 CFR Parts 1 & 602 Health Insurance Premium Tax Credit
§ 1.36B–2 Eligibility for premium tax credit. (c) Minimum essential coverage. (2) Government-sponsored minimum essential coverage. (v) Determination of Medicaid or Children’s Health Insurance Program (CHIP) ineligibility. – An individual is treated as not eligible for Medicaid, CHIP, or a similar program for a period of coverage under a qualified health plan if, when the individual enrolls in the qualified health plan, an Exchange determines or considers (within the meaning of 45 CFR 155.302(b)) the individual to be not eligible for Medicaid or CHIP.
45 CFR § 155.302 (b) Medicaid and CHIP. Notwithstanding the requirements of this subpart, the Exchange may conduct an assessment of eligibility for Medicaid and CHIP, rather than an eligibility determination for Medicaid and CHIP, provided that—
(1) The Exchange makes such an assessment based on the applicable Medicaid and CHIP MAGI-based income standards and citizenship and immigration status, using verification rules and procedures consistent with 42 CFR parts 435 and 457, without regard to how such standards are implemented by the State Medicaid and CHIP agencies.
(2) Notices and other activities required in connection with an eligibility determination for Medicaid or CHIP are performed by the Exchange consistent with the standards identified in this subpart or the State Medicaid or CHIP agency consistent with applicable law.
(3) Applicants found potentially eligible for Medicaid or CHIP. When the Exchange assesses an applicant as potentially eligible for Medicaid or CHIP consistent with the standards in subparagraph (b)(1) of this section, the Exchange transmits all information provided as a part of the application, update, or renewal that initiated the assessment, and any information obtained or verified by the Exchange to the State Medicaid agency or CHIP agency via secure electronic interface, promptly and without undue delay.
(4) Applicants not found potentially eligible for Medicaid and CHIP.
(i) If the Exchange conducts an assessment in accordance with paragraph (b) of this section and finds that an applicant is not potentially eligible for Medicaid or CHIP based on the applicable Medicaid and CHIP MAGI-based income standards, the Exchange must consider the applicant as ineligible for Medicaid and CHIP for purposes of determining eligibility for advance payments of the premium tax credit and cost-sharing reductions and must notify such applicant, and provide him or her with the opportunity to—
(A) Withdraw his or her application for Medicaid and CHIP; or
(B) Request a full determination of eligibility for Medicaid and CHIP by the applicable State Medicaid and CHIP agencies.
(ii) To the extent that an applicant described in paragraph (b)(4)(i) of this section requests a full determination of eligibility for Medicaid and CHIP, the Exchange must—
(A) Transmit all information provided as a part of the application, update, or renewal that initiated the assessment, and any information obtained or verified by the Exchange to the State Medicaid agency and CHIP agency via secure electronic interface, promptly and without undue delay; and
(B) Consider such an applicant as ineligible for Medicaid and CHIP for purposes of determining eligibility for advance payments of the premium tax credit and cost-sharing reductions until the State Medicaid or CHIP agency notifies the Exchange that the applicant is eligible for Medicaid or CHIP.
(5) The Exchange adheres to the eligibility determination for Medicaid or CHIP made by the State Medicaid or CHIP agency;
(6) The Exchange and the State Medicaid and CHIP agencies enter into an agreement specifying their respective responsibilities in connection with eligibility determinations for Medicaid and CHIP.
Covered CA Fact Sheet on Getting Covered – Summary Introduction
When you enroll in Covered CA, you give permission for them to verify your income.
Household income below 100% of the federal poverty line.
If the amount on line 5 is less than 100%, you can take the PTC if you meet the requirements under Estimated household income
at least 100% of the federal poverty line next or Alien lawfully present in the United States below.
Estimated household income at least 100% of the federal poverty line.
You may qualify for the PTC if your household income is less than 100% of the federal poverty line and you meet all of the following requirements.
• You or an individual in your tax family enrolled in a qualified health plan through a Marketplace.
• The Marketplace estimated at the time of enrollment that your household income would be at least 100% but not more than 400% of the federal poverty line for your family size for 2018.
• APTC was paid for the coverage for one or more months during 2018.
• You otherwise qualify as an applicable taxpayer (except for the federal poverty line percentage). Instructions 8962 *
#Report changes as they happen - within 30 days!
10 days for Medi Cal
- Our VIDEO on how to report changes to Covered CA
- Lost your job? How to keep your Health Insurance. Shelter at Home VIDEO
- References & Links
- Visit our webpage on how to report changes
#Form8962 Premium Tax Credit
Reconciliation Form attaches to 1040
Subsidy is IMHO hocus pocus - smoke & mirrors
it all comes out when you file taxes!
- H & R Block
- Estimate the Subsidy for Health Insurance, benefits, premiums, etc.
- 8962 ONLINE Calculator
Covered CA Certified Agent
No extra charge for complementary assistance
- Appoint us as your broker
- VIDEO on ARPA Stimulus and more Covered CA Subsidies
- Set Consultation Meeting via Phone, Skype or Zoom
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Videos on how great agents are
Enrolling in health plans has helped people focus on their families and careers, and feel protected against unexpected medical issues.
if you earn MORE than you put down for MAGI Income, when you applied for Covered CA?
CHFC – 2 Page explanation of the maximum payback – Web Archive.
Our page on 8962 Premium Tax Credit including instructions
Email us [email protected] for more information.
Child & Related Pages
Be careful though about penalties for under payment of taxes.
View our page on take it now or take it later – Tax Credit
If my income is higher at the end of the year than I thought,
do I have to pay the Enhanced Silver cost-sharing subsidies back?
No. Unlike premium tax credits, which are reconciled each year based on the income you actually earned, cost sharing reductions are not reconciled Western Poverty Page 177 * Kaiser Foundation FAQ’s However, you will have to pay any received premium assistance back up to a certain amount. Also, you are mandated to report income changes within 30 days. You also promised in the Covered CA application to report income changes within 30 days. Use the search feature ctrl – f and put in “changes.” It’s used 14 times.
Visit our webpage on Tax & APTC Subsidy Reconciliation 1040 & 8962
Federal Code of Regulations
§156.410 Cost-sharing reductions for enrollees.
§156.420 Plan variations.
§156.425 Changes in eligibility for cost-sharing reductions.
§156.430 Payment for cost-sharing reductions.
§156.440 Plans eligible for advance payments of the premium tax credit and cost-sharing reductions.
§156.460 Reduction of enrollee’s share of premium to account for advance payments of the premium tax credit.
§156.470 Allocation of rates for advance payments of the premium tax credit.
§156.480 Oversight of the administration of the cost-sharing reductions and advance payments of the premium tax credit programs.