Heads up! The IRS just issued a new tax tip for taxpayers who haven’t filed their 2014 taxes and received an advanced premium tax credit to help pay for their 2014 health insurance. The IRS urges them to file their 2014 taxes as soon as possible, in order to receive a timely advanced premium tax credit from their Marketplace for the next open enrollment period (2016 health insurance).
But, your client filed a tax extension, so why do they have to file before October 15?
This fall, Marketplaces will determine eligibility for advance premium tax credits and cost-sharing reductions for 2016 health insurance coverage. In order to avoid a gap in receiving subsidies for their Marketplace insurance, advise your clients to file their 2014 tax return as soon as possible to reconcile 2014 advance premium tax credits and maintain eligibility for future premium assistance.
It’s important to remember that if advanced premium tax payments were applied to health insurance premiums, a taxpayer will not be eligible for advanced premium tax credits or cost-sharing reductions to help pay for their 2016 health insurance, unless they file their 2014 taxes.
As usual, we will keep you updated on any IRS announcements and tips from the IRS. To find easy tools and a guide to complying with the ACA on tax returns, check out our free online guide: “Affordable Care Act: What You Need to Know.”