The Affordable Care Act, commonly known as Obamacare, has introduced many new rules for people to comply with. Every U.S. citizen and non-U.S. citizen living in the U.S. was required to have healthcare coverage beginning in 2014. If you did not get health insurance in 2014, there will be penalties charged (if you haven’t received an exemption).
If Your Employer Provided Health Coverage
If you already have health coverage through your employer or a government plan such as Medicare, then you are only required to check a box on your tax return to indicate that you are covered. Your employer will give your Form 1095-C, which contains information about the coverage provided to you. The employer is required to report the cost of coverage on your health plan on your W-2.
If You Bought Coverage from the Marketplace
If you bought health insurance from the Marketplace in 2014, then you need to:
- Renew your coverage for the current year (if it has expired),
- Look for a better plan or continue with your current plan.
If you purchased health insurance from the Health Insurance Marketplace (also known as the Affordable Insurance Exchange) last year, then you will receive Form 1095-A. This form contains information to help you complete Form 8962 for getting Premium Tax Credit. Make sure that you calculate the amount of premium correctly.
Another important factor to consider when reporting your health insurance is to check if there were any changes in your circumstances that affect your tax and health insurance status. Depending upon the changes, your premium tax credit amount can change.
If You Cannot Afford Health Coverage
If you are unable to purchase health insurance from the Health Insurance Marketplace, then you may qualify for Medicare, Medicaid, CHIP, TRIPCARE, or student health or state high-risk pool programs. Being covered under any of the above will help you to get the subsidy known as the Premium Tax Credit.
The amount of subsidy is determined by the size of your family and your income. The premium tax credit is refundable, which means that even those with no income tax can receive the benefit.