Why am I not seeing a Premium Tax Credit? 2020

[rprastein]

When I signed up for Covered California in June 2020 when my COBRA coverage expired, I anticipated income of about $66,000 for the year (married filing jointly, but hubby is on Medicare).  I didn't have any estimated Federal premium tax credit at that time, so none was advanced to the insurance company, but I did have a couple hundred dollars knocked off the premiums due to a California subsidy.

Now I'm doing my 2020 taxes, and our income is less than a third of what I had anticipated (I forgot to do a Roth IRA conversion that I had intended to do...), and after the unemployment exclusion it's only about $10,000, yet TurboTax is still saying we are not entitled to any premium tax credit.  I can't find any explanation of how this is calculated in TurboTax, they just wave their figurative hand and tell me not to worry my pretty little head about it, they'll figure it out for me.  The Covered California web site won't let me see information for 2020 eligibility, but they'll let me apply for 2021 or look at (but not change) my information from my 2020 application.  I remember last year I had seen some tables of what income levels were eligible for which benefits, but I can no longer seem to find them.

How can I see where/how the determination is made that I'm not eligible for a credit, and how far I am from being eligible?

Thanks,

Rebeccah

[AmeliesUncle]

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@rprastein wrote:

none was advanced to the insurance company

our income is less than a third of what I had anticipated (I forgot to do a Roth IRA conversion that I had intended to do...), and after the unemployment exclusion it's only about $10,000

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Your income is too low.  To qualify for the credit, your income (Modified AGI) had to be at least 100% of the Federal Poverty Level, which is $19,460 for a household size of two.

If you had received some Advance credits (column C of the 1095-A), you would have met one of the exceptions.  But with no Advance credit, your income is too low to qualify for the credit.

[rprastein]

You're right.  I had to print out the records copy of my draft and look through everything to see the juxtaposition.  2019 and 2020 are killer tax years for me -- lots of intersecting issues, lots of forms and worksheets, and confusing instructions and some software glitches, combined with misunderstandings and data entry errors on my part.

Rebeccah

[DawnC]

The premium tax credit came about after the Affordable Care Act in 2009. You must meet certain requirements to claim this refundable tax credit and file Form 8962 with your tax return.   And yes, TurboTax takes the figures from your Form 1095-A and does the calculations behind the scenes.  

Eligibility requirements for the premium tax credit   This link has more details regarding the credit and Form 8962.  

[schnoodle]

I still don't understand because when you create an application on healthcare.gov it asks a set of simple questions - including your estimated income, filing status (single) etc and spits out an anticipated amount you'll qualify for ... then you get to Turbo Tax, your income falls below what you estimated and now the $3600 that healthcare.gov estimated goes to zero. How can this be?

[Vanessa A]

Did you enter your 1095-A?  Most people receive this credit as an advanced premium that lowers their monthly insurance premium. 

You will find the Premium Tax Credit amount on form 8962 line 26 or line 9 of your schedule 3. 

[schnoodle]

I did in deed and Turbo tax came back with saying I qualified for zero.  I looked at the underlying Form 8962 and line 5 there says I'm 192% of the poverty line. The thing of this is, the current amount of income I've entered (2a of this form) is nearly 20k less than what I entered at healthcare.gov - that 192% of the poverty line is what's cranking down line 7 to 0.0168

Line 11 of that form correctly shows the total premium as $7672 

Thankfully I took zero of the proposed tax credit healthcare.gov indicated they thought I was eligible for .... here's from my eligibility letter "You can use up to this much of the tax credit: $434 each month, which is $5208 for the year" and again that letter shows the reported income as 18k MORE than what's currently on line 2a

[AmeliesUncle]

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@schnoodle wrote:

Thankfully I took zero of the proposed tax credit healthcare.gov indicated they thought I was eligible for .

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Are you entering an amount for column B of the 1095-A into the program?  You need to look that number up and enter that amount.

[schnoodle]

On the 1095-A form I entered zeros for Part III columns B and C.  I've also added additional income since then and now Form 8962 shows $3221 for line 8a - which I take as the amount I'm eligible as a tax credit (given I took NO advances on the credit).

When I look at line 11 of the 8962 here's what it shows"

11 Annual Totals

    Line 11a = 7,672

    Line 11 b  =0

    Line 11 c = 3221

    Line 11 d = 0

    Line 11 e = 0

    Line 11 f  = 0

The monthly calculations below that (lines 12-23) are all blank.  Lines 24-26 are all zero. Why isn't the $3221 carrying forward *somewhere*?

I see this in the IRS 2021 Instructions for Form 8962 document :

Form 1095-A, Part III, column B, generally reports the applicable SLCSP premium.  IF NO APTC WAS PAID FOR YOUR COVERAGE  your coverage, Form 1095-A, Part III, column B, may be wrong
or blank or may report your applicable SLCSP premium as -0-

Is that my problem??? I need a corrected 1095-A?

===== UPDATE ====

Drum roll please .... apparently because I purchased my MARKETPLACE ELIGIBLE PLAN directly off the Blue Cross Blue Shield website and didn't ELECT to take any advance on the premium, BCBS didn't at all report back to Healthcare.gov my eligibility. Now I'm screwed because there was only a 90 day period to appeal this back oh in 2020.

[AmeliesUncle]

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@schnoodle wrote:

On the 1095-A form I entered zeros for Part III columns B

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That is  your problem.   If you had continued reading in the instructions (and I think it says that somewhere on the TurboTax page), you would have seen that it points you to this website to look up the information.  Once you do that, everything should work fine.

https://www.healthcare.gov/tax-tool/#/

[schnoodle]

Except Healthcare.gov is telling me I had 90 days to dispute my not being "eligible" (e.g I'm guessing what BCBS reported back to them --- because I elected using 0 of the APTC).  Kicking myself for not electing to use $1

[AmeliesUncle]

Being "eligible" for the ADVANCE payments has NOTHING to do with the actual tax credit.  

Look up the numbers, enter them in the software, and if you qualify for a credit, you will get it.

[schnoodle]

That's not the case. You have to submit an application, be deemed eligible and/or dispute the healthcare.gov's determination you're ineligible.  That's the problem here - I'm hoping I can dispute which ever side screwed up in their determination that I'm ineligible. That's why column "B" is all zeros on my 1095-A.  I can't just go into Turbo Tax and modify the column "B" to include what the premium is for the Second lowest premium. I need Blue Cross Blue Shield to issue a modified 1095-A. 

[AmeliesUncle]

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@schnoodle wrote:

You have to submit an application, be deemed eligible and/or dispute the healthcare.gov's determination you're ineligible.  

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That is wrong.  I've told you the correct answer several times, so I guess there is no point in my saying any more.

[schnoodle]

Something is wrong - based on my income I'm eligible (e.g. I'm below 400% poverty line) and I'm surmising it's because my 1095-A Part III column B is all zeros. Did I miss where you commented on that?

The IRS 8962 instructions state:

"Form 1095-A, Part III, column B, generally reports the applicable SLCSP premium.  IF NO APTC WAS PAID FOR YOUR COVERAGE  your coverage, Form 1095-A, Part III, column B, may be wrong or blank or may report your applicable SLCSP premium as  0"

This is WHY Turbo tax is resulting in no premium tax credit. If I enter values into column B, then Turbo tax starts racking up the refund. Again, I took no advance on the tax credit, my income *should* result in a premium tax credit but it's not - because I believe my 1095-A is INCORRECT. I've contact both Healthcare.gov and Blue Cross Blue Shield about my 1095-A.

I'm not trying to be difficult - it's extremely confusing this being the first year I've done this.  How would a person know their 1095-A is incorrect and then Turbo Tax is calculating things incorrectly other than by finding that paragraph in the IRS instructions?

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Think I just solved my own issue.  When I called Healthcare.gov last week - they're the ones that told me I would have to try and dispute my 2021 application. That my application determination was that I wasn't eligible, etc. I continued on reading the instructions for the 8962 form and found there's a tool online at healthcare.gov to compute the SLCSP for a given year:

"No APTC was paid for your coverage. If no APTC was paid for your or your family member’s coverage, the SLCSP premium reported in Part III, column B, lines 21 through 32, of Form 1095-A may be wrong, left blank, or reported as -0-. To determine your applicable SLCSP premium for each month, see Pub. 974 or, if you enrolled through the federally facilitated Marketplace, go to HealthCare.gov/Tax-Tool/. If your correct
applicable SLCSP premium is not the same for all 12 months, check the “No” box and continue to lines 12 through 23"

Now why they didn't tell me this when I called is beyond me.