Form 1095-A, tax credits mostly unused, how will it affect refund?

[DarlaAnne]

My daughter signed up for Obamacare and got a $320 a month tax credit for 2019. She did pay the monthly plan ($6 a month) but she only used it once or twice early on and not the rest of the year. She lost it around Sept.

Right now when we estimate, it is showing their (her and her husband's) joint refund at around $10,000 (99% all his regular job income).

Do you know about how much, even ballpark, this will deduct from that? and did the fact that she hardly used the credits make a difference?

She looked into filing separately but it cuts his refund in half.

Any info is appreciated. We are going through a family medical crisis and desperately need as much of that refund as possible.

[ColeenD3]

No, "not using the credit" makes no difference. When she signed up for Obamacare, the Premium Tax Credit was applied, paying a portion of her healthcare premium costs.

If circumstances change, like marriage or divorce, the Marketplace has to be informed to recalculate the credit. If more money is made than was reported, then she would not have been eligible for such a large credit. If it is over the amount it should be, then she has to pay a portion of it back.

[DarlaAnne]

We got her form yesterday and this is what it shows. She ended up barely working that year (4 months at a low pay), less than anticipated. I do not think she included her husband's income at the time because they were living apart, but in order to get the most refund they have to jointly file. Does the third column (the actual tax credits) reflect what she will be responsible for?

[DianeC958]

No,  the third column on the 1099-A form does not show what she will be responsible for.

The third column on the 1095-A form shows the amount of Premium Tax Credit she received to help her pay for health insurance.

Once she has put the information from the form 1095-A into her return the program calculates if she needs to repay any of the Premium Tax Credit she received back or if she qualifies for an additional amount of Premium Tax Credit which adds to her refund.

Link with more information about form 1095-A

For the Married Filing Joint typically it is better to file as Married Filing Joint than Married Filing Separately since when you file as Married Filing Separately there are many credits that you are not allowed to receive.

Link with more information about Married Filing Joint vs Married Filing Separate

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