Obamacare Tax Credit: HHS, Treasury Department Working to Help Tax Filing Season Due to Affordable Care Act
As the tax filing season is underway, the U.S. Department of Health and Human Services (HHS) and the Treasury Department are working on easing the process for Americans, particularly questions from the Affordable Care Act (ACA).
Based on a statement from the two federal departments, tax filers will see changes to their tax returns. While most tax filers, which the Treasury Department and HHS state as "over three quarters," will simply check a box on their tax return to indicate if they had health insurance coverage during 2014, other people who had health coverage from the insurance marketplaces and those who did not enroll for insurance will have additional steps in the tax filing process.
According to the joint statement, the Obama administration will release additional resources to assist Americans for the tax filing season, including help on exemption eligibility.
"For the vast majority of Americans, tax filing under the Affordable Care Act will be as simple as checking a box to show they had health coverage all year. A fraction of taxpayers will take different steps, like claiming an exemption if they could not afford insurance or ensuring they received the correct amount of financial assistance," Treasury Secretary Jacob Lew said.
The Treasury Department secretary acknowledged that a small fraction of taxpayers will pay a fee if they did not receive health insurance coverage during 2014. He added that the administration is working to ensure that taxpayers "can easily access clear information since this is the first year they will see certain changes to their tax returns."
HHS Secretary Sylvia Burwell said the ACA provided tax credits for many health insurance consumers through the health exchange marketplace.
"In the coming weeks, HHS will work with other agencies, tax preparers and community organizations to arm these consumers with the information they need to know as they prepare to file their taxes," Burwell said. "We will also be providing helpful tools so that the millions of taxpayers who qualify for an exemption can receive one."
People who received health insurance as a result of the ACA will receive a new form in the mail -- Form 1905-A -- by early February.
As part of the campaign effort for Americans to understand the tax filing changes, people who received health insurance coverage from the marketplace should expect emails, phone calls and even text messages with personalized information relevant to their tax status.
"We will focus on providing targeted messaging to consumers who benefited from an advanced premium tax credit last year to help them offset the cost of their Marketplace premiums," noted the two departments in a statement.
The Obama administration will also work with "top tax preparers" to provide taxpayers with information for filing.
As Latin Post reported, the penalty fee for not having health insurance will vary on a person's income. For 2014, the IRS had announced the penalty is 1 percent of taxable income or $95 person, pending which cost is higher based on the 2014 federal tax return. According to HealthCare.gov, the penalty for individuals is only for those earning more than $10,000 for income. The maximum penalty is the national average premium for the bronze plan.
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