Hi Tax Pros!
I wanted to get your opinion and guidance on the following situation.
My partner (we're not legally married, but we have 1 child together) and I filed separately in 2023.
When she did her 2023 taxes, she forgot to include her Form 1095-A and did not fill out and include Form 8962 from HealthCare gov for health premium tax credits for her and our daughter for the entire year. She made very little in 2023.
When I did my 2023 taxes I filed as head of household and include our daughter as a dependent. I also didn’t know about the form 1095-A so it wasn't included (nor was Form 8962 filled out). I made a lot more income in 2023 than my partner (so I think wouldn't qualify for those health premiums tax credits?).
Fast forward to today, the IRS sent me a Letter 12C and is requesting a copy of the 1095-A form and a completed Form 8962. According to my calculations this could cost me upwards of $9,000 (value of tax credits from Form 1095-A) or is it only about half since I'm only claiming my daughter as a dependent?
What is the best course of action to save as much money as possible? I was thinking of having my wife amend her return to claim our daughter as a dependent and to amend my return to not have a dependent - is this allowed and advisable? What are your thoughts on best course of action?
Obviously I want to keep everything legal but I also want to minimize my wife's and my tax liability (in total).
Thank you!
