1095A and Premium Tax Credit

[DanSin]

I have a healthcare plan purchased through the Marketplace, but we have never received any subsidy or assistance.  Up until this year, Column B on our 1095A has always been blank (0.00) as well as Column C.  Column A contains our premiums paid for the year.  THIS year, I see amounts in Column B - greater than what we're paying for our plan.  As I fill in the information in TurboTax, entries in Column B start racking up a HUGE refund.  I have checked Form 8962 and it looks like we are getting a very large Premium Tax Credit - although our income is 401% of the poverty line for our state so this doesn't technically apply to us.  This doesn't seem right - we've never received such a huge tax credit for anything, and with our income I don't think we should be eligible.   If I leave off the 1095A entries and put the premiums on my Schedule C as SE Health Insurance, I end up owing around $2000.  If I make the 1095A entries, it calculates a $10,000 refund.  Something is not adding up for me, not quite sure what to do.

[TeresaM]

Just to clarify, we would like to take a deeper look at this to see what is happening. It would help to have a diagnostic file, which is a sanitized copy of your tax return that has all of your personal information removed but has all of the forms and numbers entered. You can send one to us by following the directions below and posting the token number here so we can access the sanitized return.

 TurboTax Online:

1. Sign in to your online account
2. Click on Tax Tools on the left toolbar
3. Select Tools
4. In the pop-up screen, click on "Share my file with agent"
5. Click OK on the message that a diagnostic file will be sanitized and transmitted to us
6. Please post the Token Number

TurboTax Desktop/Download Versions:

1. Open your return
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3. Select "Send Tax File to Agent"
4. Click Send on the message, and the tax file will be sanitized and transmitted to us
5. Please post the Token Number

[DanSin]

Token 950886

[TeresaM]

Thank you very much for the additional information.

If this Form 1095-A is correct as entered, then it looks as if you and your spouse should have qualified for an Advance Premium Tax Credit paid to your insurance company throughout 2021, to help with the cost of premiums. Because you did not receive any in advance, it is reconciled on Form 8962 and the amount you could have received is added to your income tax refund.

I have reviewed your Form 8962 and it looks in order. The numbers are coming from your Form 1095-A.  If you received no advanced credit, it is fine that Column C is blank, rather than 0, as that works better.

• If your Form 1095-A looks accurate, this part of your return looks ready to file. If you are still entering other income, the final number may vary as your income is also part of the calculation.
• If these numbers do not look right, you can go to healthcare.gov and log in to review their Form 1095-A there.
   
• If you have already checked online at Healthcare.gov for Form 1095-A information and do not find what you need, you may wish to call them and see if your copy is correct. You may reach them at:
• 1-800-318-2596
• (TTY: 1-855-889-4325)
• Available 24 hours a day, 7 days a week (except holidays)

[DanSin]

Thank you, you make it clear.  

[AmeliesUncle]

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@DanSin wrote:

Up until this year, Column B on our 1095A has always been blank (0.00) 

although our income is 401% of the poverty line for our state so this doesn't technically apply to us. 

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If column B is zero or blank, you should look up the proper amount at the Healthcare Marketplace.

What is on Line 5 of Form 8962?  Did you collect Unemployment Compensation in 2021?

[DanSin]

This year, column B is filled.  The amounts in Column B are greater than the amounts in Column A, which contains the premiums I paid.  I checked with the Marketplace and those amounts are correct.  We collected no unemployment.  Line 5 of 8962 says 401%.

[JillS56]

Column A and Column B are just informational it is Column C that matters.   The Line 5 at 401% is determining if your income was under the poverty level to which you would be or have been entitled to a supplement.   If you paid the full amount in Column A and there is nothing in Column C, then you did not get a supplement.

Column A is the Monthly Enrollment Premium, Column B is the Monthly second lowest cost silver plan (SLCSP) premium, and Column C is the Monthly advance payment of premium tax credit.   Column C is what is considered the supplement.  Do you have amounts in Column C?   If not, you do not need to be concerned.   The 401% means that you are not eligible for the monthly supplement.   If you have an amount in Column C that would mean that you have to pay back the supplement you received and it would be included on your Form 1040, Schedule 3, Part II, Line 9.   Check to see if you have an amount on Schedule 3, Part II Line 9.  

If you do not have an amount on Schedule 3, Part II, Line 9, you do not have to pay back any premium.   

All of what you said is correct in the way it is being reported.   You can just continue on with your return.

[AmeliesUncle]

For 2021, you still could qualify for a Premium Tax Credit even if your income is over 400%.  However, a $12,000 credit seems extremely unusual, so I suspect that something could be miscalculating.

In the event you wanted to tell me all of the numbers that are showing up on Form 8962 (or better yet, a picture of it with any of your private information removed), I would be able to tell you if it is correct or not.

[DanSin]

Without getting into specifics, when I enter my paid amounts in Column A - it shows that I have a certain amount due on my taxes (this is about the amount that I expect to pay each year.)  When I start adding the amounts in Column B - TurboTax suddenly begins calculating a refund for me, and each month's entry racks up the money I'm "owed."  Since this Column B SHOULDN'T have an impact on what I'm paid or what I owe, it seems vastly incorrect that the amounts in this column should contribute to my refund calculation. 

Since I receive no assistance, I believe I can just enter 0 in Column B and stay with the calculation that seems normal, based on my situation.   

[AmeliesUncle]

As I said before, for 2021 you MIGHT still qualify for a Premium Tax Credit even if your income is over 400%.  And when entering an amount in column B, that is what would start the program to calculate if you qualify or not.

But as I also said before, that large of a credit seems highly unlikely, so something does seem wrong.