Why do owe taxes after entering my 1095-A?

[johnkgan]

Hi there,

• I had got medical insurance through Covered CA with zero premiums in 20th Dec 2022 when I did not have income and qualified for it with zero premium.
• (I also got medical coverage as IHSS Live-In provider for my grandma, but I did not include that W2 as that  had $0 wages in box1 as tax is 0 for live-in provider). 
• I got a job in May 2023 and the coverage was not good. So, I continued and canceled it in Oct 2023.

I received 1095-A Health Insurance Market Place Statement

Under Part III, I see 321.90 in column A, 392.24 in Column B, 320.90 for each month from Jan to October.

When I enter those in TurboTax, it increased my Federal tax due from $2205 to $5191.

I am surprised as I thought Covered CA was free.

Please confirm if I am missing something. Thank you.

[DawnC · Accepted solution]

The Premium Tax Credit doesn't work like that.  You are having to pay back the premium subsidies you received (column C) because you were not eligible based on your actual income, family size, and zip code.  When you enrolled, you qualified for those subsidies based on your estimates of those 3 things: income, family size, and zip code.   Now that you are filing your tax return, you have to use your actual income to determine the credit and/or the amount you have to pay back.    

It is very important to update your information if you get married, get a job, or move, so your subsidy amounts can be adjusted.  Save that link to report changes to your situation.  

[johnkgan]

Thank you DawnC ! I understand that I made a mistake as I was not aware that I would have to pay around $3000 more for Federal by keeping the Covered CA plan.  Please confirm if that would  also increase my California State Tax. Thanks again