IRS Health Care Tax Tip 2015-47, August 6, 2015
If you’re a newlywed, be sure to add a health insurance review to
your to-do list. This is particularly important if you enrolled in
coverage through a Health Insurance Marketplace and receive premium
assistance in the form of advance payments of the premium tax credit.
Advance credit payments made to your insurance company are based on
an estimate of the credit that you will claim on your federal income tax
return. The Marketplace estimates the credit by using information about
your family composition and projected income that you provide when you
submit your application.
It is important for you to report changes in circumstances to your
Marketplace to get the proper type and amount of financial assistance
and to avoid getting too much or too little in advance. Reporting
changes in circumstances will allow the Marketplace to adjust your
advance credit payments. This adjustment will help you avoid getting a
smaller refund or owing money that you did not expect to owe on your
federal tax return.
To report changes and to adjust the amount of your advance payments of the premium tax credit you must contact your Health Insurance Marketplace.
Be sure to report all changes directly to that Marketplace because they
can affect both your coverage and your final credit when you file your
federal tax return.
Other changes you should report to the Marketplace include:
• Birth or adoption
• Marriage or divorce
• Moving to another address
• Changes in household income
These changes may also open the door for the Marketplace special enrollment period
that permits health care plan changes. In most cases, the special
enrollment period for Marketplace coverage is open for 60 days from the
date of the life event.
Estimating Your Change
The Premium Tax Credit Change Estimator
can help you estimate how your premium tax credit will change if your
income or family size changes during the year. This estimator tool does
not report changes in circumstances to your Marketplace. Because these
tools provide only an estimate, you should not rely upon them as an
accurate calculation of the information you will report on your tax
return. You should use these estimators only as a guide to assist you in
making decisions regarding your tax situation.
For more information, see the Affordable Care Act Tax Provisions for Individuals and Families page at IRS.gov/aca.
Source: Internal Revenue Service
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