Health Care subsidy and impact of credit on AGI

[Bill372]

If I do not use the Healthcare Subsidy Credit (as the IRS says you cannot) then My AGI is to high and I have to pay back my credit.  But when I do that my AGI drops below the amount which means I am eligible for the credit.  Turbo Tax deals with this by having me use the credit portion in my deduction for Self Employed health insurance.     I can eliminate that problem by making a IRA contribution to lower my AGI so I qualify for the credit with only what I paid for Health care not including the credit.

Does anyone know if what Turbo Tax did was correct?  I would prefer not to make the IRA contribution if I do not have to but I am afraid if I don't the IRS may come back and say I have to pay back the healthcare credit which is about $6,000.

[SamS1]

Personally, I would take the IRA deduction and not take the chance.  Its better paying yourself than paying to the IRS.  If you deposit before 4/15 you can take the deductions for 2020.  So it sounds like you purchased insurance through the marketplace and received a 1095-A for the premium credit.  You would enter in in your business income and expenses your out of pocket medical insurance expenses that would be an adjustment to income.  You would not include the gross amount of your premiums before the premium credit.  

[Bill372]

That is what I am going to do.  TT tells you not to enter marketplace heal in the schedule C but does ask you later if you have a 1095 A.   I did that plus I added my dental insurance premiums.   What is weird is TT came up with a number more then the sum of my contribution and my dental.  I cannot find how it came up with the number and in the pdf for your records it even says you will not find it in the worksheets but does not say where to find it.

[JoannaB2]

The form 1095-A is used to report health insurance purchased through Healthcare.gov or your state's Health Insurance agency  The form 1095-A is mailed to taxpayers on January 31 of the year.  You may call your Health Insurance Marketplace to avail a copy or visit the website..

If you received the 1095-A form, it must be entered on your income taxes to reconcile advance payments of the premium tax credit made on your behalf with the premium tax credit you are claiming on your tax return.  If you received advance premium and your household income was over the federal proverly line, you may have to payback some or all of the advance premium received.

See,reconciling advancced payments, link

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