I purchase health insurance through the Covered California Exchange, and receive a Healthcare Premium Tax Credit based on my estimated income. Unfortunately my income is variable from year to year, and last year I am fairly certain I have received too much "relief" on my health insurance payments and will likely owe some money back to the government. I deduct the monthly health insurance premiums I pay from my taxes, as they generally exceed 7.5% of my income. If my premium tax credit was too high last year, and I wind up owing money back to the government, I know that TurboTax will figure that out and add it to what I owe, but..... Will it automatically add that amount to the what I deduct for the premiums I have paid, or do I have to figure that out manually?
In other words, if my premiums are $10/month, but my tax credit reduces that amount to $6/month, and it then transpires that my income was high enough that I no longer qualify for the tax credit at all, I will owe the government an extra $48 at the end of the year (i.e. $(10-6) times 12). In doing my taxes I would have entered $72 into TurboTax as a healthcare expenses ($6 times 12) for the premiums I have paid, but if I end up not getting $4/month help from the government, that number should have been $120 ($10 times 12). Will TurboTax handle that automatically, or do I need to loop back around myself and correct the amount I am deducting?
