1095-A Repayment

Forum|Forum|6 years ago
April 29, 2020
1 reply
12 views

I had to take an early distribution from an inherited IRA in order to cover insurance, medical and other living expenses. When I enter my 1095-A, Turbotax is including this withdraw in the income calculation for my insurance tax credit and saying I owe repayment.

I am self employed and when I applied for insurance on the state marketplace, I had to file estimated income so that withdrawals from this account were not included in the calculation for health care tax credit. At the time, I overestimated my income for 2019 and ended up making less than I expected so if anything, I would think I should be getting a refund for overpayment.

How do I adjust for this in Turbotax?

MinhT1

Level 15

Unfortunately, as the withdrawal for your inherited IRA counts as income, you owe that repayment of the premium tax credit. There is no adjustment possible.

Please read this Marketplace document for more information.

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DeeksAuthor

Level 2

Strange as I don't believe that has been a problem in past years. I made a withdraw in the year prior also. When I applied for insurance, I had to file an estimated income statement based on business earnings without factoring in any withdraws.

Catch 22 here. I had to make an early withdraw because income wasn't enough to cover insurance costs. Doing so raises my insurance cost.