1095-Allocation

[Jesse0831]

I received form 1095-A . I am policyholder with my two adult children. I can no longer claim them as dependents for 2023. How to I allocate percentages for the 3 of us. Also when allocating do I need to enter percentages in all 3 boxes A B and C? Would all 3 boxes be same amount?

[DawnC]

You can allocate the policy however you 3 agree to allocate it as long as the totals reported for the 3 of you add up to 100%.   When you enter your 1095-A into TurboTax, there will be an option (a box to check) that says I shared this policy with someone not on my tax return.   After checking that box, you will get the option to name someone else as recipient of the amounts in Boxes A and C - premium amounts and advance payments of the Premium Tax Credit (PTC).    Two examples are below.   

Child/Children on another tax return

If you share a policy with someone who is claimed on another tax return (usually a child), you can take the number of people on your tax return who are covered on that plan and divide it by the total number of people on the plan. This would be your percentage of premiums, SLCSP and advanced payment of the premium tax credit, unless you agreed on a different number beforehand.

Example: Rich and Jackie are divorced and have two children, Ronald and Jimmy. The children live with Jackie, and she claims them as dependents, but Rich enrolled him and the two children in a Marketplace plan in 2021. Rich and Jackie didn't agree on allocation percentages, so she takes the number of people on her taxes who are on the plan (the two children) divided by the total number of people on the plan (Rich and the two children). Jackie will take 67% of the premiums, SLCSP and advanced payment of the premium tax credit. Rich will take 33%.

Shared plan with more than one person

If you shared a Marketplace plan with two or more people who are on separate tax returns, you'll have to find what the SLCSP is for each person's household and add it up. Then, divide your SLCSP by the total SLCSP to get your percentage of premiums and advanced payment of the premium tax credit. The SLCSP percentage is usually left blank.

Example: Alberto has two young daughters and a 25-year-old son, Mitchell. Alberto claims the two girls as dependents, and Mitchell files independently.  All four of them shared a Marketplace plan. The SLCSP for Alberto and the two girls, a family of three, is $12,000, and for Mitchell alone it would be $6,000. Alberto divides $12,000 by the total cost of the SLCSPs for everyone, or $18,000, to get 67%. This would be his percentage of premiums and advanced payment of the premium tax credit. Mitchell divides his SLCSP, $6,000, by $18,000 to get 33%, or his percentage of premiums and advanced payment of the premium tax credit.

[Mike9241]

Before you complete line 10, you must complete Part IV if you are Allocating policy amounts (see below) with another taxpayer 
Allocating policy amounts. You need to allocate policy amounts (enrollment premiums, SLCSP premiums, and/or APTC) on a Form 1095-A between your tax family and another tax family if:
1. The policy covered at least one individual in your tax family and at least one individual in another tax family; and
2. Either:
a. You received a Form 1095-A for the policy that does not accurately represent the members of your tax family who were enrolled in the policy (meaning that it either lists someone who is not in your tax family or does not list a member of your tax family who was enrolled in the policy), unless you want to allocate 10% to yourself check yes on line 9

the rules for policy allocation among multiple tax families

Situations where a policy is shared among tax families. Complete Part IV using the rules in this section if you need to allocate policy amounts (you are not allocating 100% to yourself). This situation generally applies if you indicated to the Marketplace that you would include in your tax family an individual being included in the tax family of another taxpayer, and APTC was paid on behalf of the individual. In such cases, the Form 1095-A sent by the Marketplace for the policy does not accurately reflect the members of your coverage family and the other taxpayer's coverage family. Therefore, you and the other tax family must allocate the enrollment premiums, the APTC, and the applicable SLCSP premium so that each family is able to compute their PTC and reconcile their PTC with the APTC paid for their coverage.
Under the rules in this section, you and the other taxpayer may agree on any allocation of the policy amounts between the two of you. You may use the percentage you agreed on for every month for which this allocation rule applies, or you may agree on different percentages for different months. However, you must use the same allocation percentage for all policy amounts (enrollment premiums, applicable SLCSP premiums, and APTC) in a month. If you cannot agree on an allocation percentage, each taxpayer’s allocation percentage is equal to the number of individuals enrolled by one taxpayer who are included in the tax family of the other taxpayer for the tax year divided by the total number of individuals enrolled in the same policy as the individual(s). The allocation percentage you use and that you put on line 30 of Form 8962 is the percentage of the policy amounts for the coverage that you will use to compute your PTC and reconcile APTC.
Policy amounts allocated 100%. If 100% of the policy amounts are allocated to you, check “Yes” on line 9 and complete Part IV by entering 100 in the appropriate box(es) for your allocation percentage. If 0% of the policy amounts are allocated to you, complete Part IV by entering -0- in the appropriate box(es) for your allocation percentage.

if you allocate less than 100% to yourself the other tax families will need to include corresponding info in their tax returns.

one other rule 

If you indicated to the Marketplace at enrollment that you would claim an individual in your tax family for the year of coverage but the individual is not included in any tax family for the year of coverage, you must report any APTC paid for that individual's coverage