1095-A and 8962

[CoachRandy]

Good morning...I am helping a friend who just received a Health Insurance Marketplace 1095-A form with instructions to transfer some of the information to an 8962 form. In line A of the 8962 it indicates that you cannot take the PTC if your filing status is married filing separately. That is the case for my friend, she is recently separated, still officially married, and filing separately. She did not pay these premiums in 2023, her spouse did.  My question is at this point, what does she have to do with the information on the 1095-A married and filing separately?  Will this hurt her and the amount of tax is will be required to pay?

Thanks in advance for your reply.

[Vanessa A]

Since she is Married Filing Separately, she is not eligible to claim or receive the Premium Tax Credits for health insurance through the Marketplace unless she is a victim of abuse or spousal abandonment. 

If she did receive the credit, then  he or she will need to repay the credit depending on how they work it out.  This will be added to whichever persons tax liability and become part of the taxes due or result in a decrease in their refund.

If both of them are on the 1095-A, they will need to select that they shared the policy with another taxpayer and both of them will need to enter the form on their returns.  They will then need to agree on an allocation amount from 0% to 100%.  It does not matter who paid what, it can be allocated however they agree to allocate it.

If she had her own 1095-A, then she will just need to enter it on her return.  

If they paid the full premium and did not get any credit, then there will be no affect on her return.

Depending on their situation, even if they are separated, they may be better off filing a joint return.

Premium Tax Credit MFS

Form 8962 Instructions

[CoachRandy]

Her husband handled the payments if there were any on the premiums.  The monthly premiums (Collum A, 1095A) shows a premium amount monthly of $1646.04.  Collum B shows $1873.78 monthly.  And collum C shows $1644.04.  Sorry for my ignorance but do they have any credit that needs to be addressed?  

[Vanessa A]

Yes, when she files (or he) depending on how they split it, one of them will likely half to pay some or all of the Advanced Premium Tax Credit back. 

[CoachRandy]

Thanks.  And that is the amount in Collum C?

[Vanessa A]

Correct.  The amount is column C is the amount that will end up being paid back.  It may be subject to repayment limitations which will decrease the amount that has to be paid back.  But this will depend on their income.