What PTC amount for 56,085 on line 12 and 5,478 (it's SLCSP) on 1040's line 29? TT says $0, but this is wrong: expected contribution is < 5,478. What is right? SE single

[TaxGuyBill · Accepted solution]

Are you Single with no dependents?

If so, look Line 37 of your Form 1040.  Is it more than $47,520?  Anything higher than that is over 400% of the Federal Poverty Level, which disqualifies the Premium Tax Credit.

[mathstach]

Yes, single, no dependents. After SE tax and health insurance deduction, line 37 is less than $47,520. I qualify for PTC, but TT gives $0 (wrong answer, as IRS ITA says I qualify).

[TaxGuyBill]

Is Line 37 close to $47,000-ish?

Did you enter an amount in column B for your 1095-A?

Is your actual cost of insurance (column A of the 1095-A) also more than the expected contribution of $5,478?


This is ONLY a testing procedure, not a 'fix', but try this:
(1)  Look at the amount of your health insurance deduction.
(2)  Enter that amount in the Business section, under insurance, and your personal health insurance (where it tells you NOT to enter your 1095-A health insurance).
(2) Edit your 1095-A and the screen immediately after that UNCHECK the box saying it is connected with your Self Employment.

Is Line 37 still less than $47,520?
Does it calculate the Premium Tax Credit?

[mathstach]

Line 37 is $46,645, which comes from starting with $56,085, then deducting $3,962 from half of self employment tax, and also deducting $5,478 for health insurance. Both Columns A and B of 1095-A have $456.46 for each month. Actual cost of insurance, $5,478, is less than the expected contribution of 9.69% of MAGI. I tried your testing procedure, and it gave a PTC of $915, while Line 37 is still less than $47,520. So the true answer is somewhere between $0 and $915. How to get correct PTC?

[mathstach]

Line 37 is $46,645, which comes from starting with $56,085, then taking $3,962 from half of self employment tax, and deducting $5,478 for health insurance. Both Columns A and B of 1095-A have $456.46 for each month. Actual cost of insurance, $5,478, is less than the expected contribution of 9.69% of MAGI. I tried your testing procedure, and it gave a PTC of $915, while Line 37 is still less than $47,520. So the true answer is somewhere between $0 and $915. How to get correct PTC?

[mathstach]

Line 37 is $46,645, which comes from starting with $56,085, then taking $3,962 from half of self employment tax, and deducting $5,478 for health insurance. Both Columns A and B of 1095-A have $456.46 for each month. Actual cost of insurance, $5,478, is less than the expected contribution of 9.69% of MAGI. I tried your testing procedure, and it gave a PTC of $915, while Line 37 is still less than $47,520. So the true answer is somewhere between $0 and $915. How to get correct PTC?

[TaxGuyBill]

Unfortunately, this is a program bug that they won't fix.  The special calculation goes back and forth to get a final number.  The 'bug' happens when the back and forth calculation goes past the $47,520 amount.  Rather than continuing to calculate it until it gets an answer, it stops and says you don't qualify.

So in direct answer to your question about how to get the correct amount, you either need to manually do the calculations (which is gruesome), use another software, or go to a tax professional.

Sorry for the bad news.  I wish they would fix it (I pointed out the problem in 2015, but they have ignored most of the things I have pointed out).