I thought I should try to figure this out before tax time. I’m self employed and I accidentally had Medicaid and marketplace insurance for 2 months this year at the same time while getting advanced premium tax credits.
I had a renewal with Medicaid this year as part of the ending of continuing enrollment and later received a denial letter. I legitimately thought I qualified for an open enrollment period, so I signed up for marketplace insurance. The marketplace checked that I was losing coverage, which I thought I was, and deemed me eligible.
It turns out that my Medicaid was still active and I was moved to a different case and type. I canceled my marketplace coverage as soon as I knew about my Medicaid coverage still being active.
It took months for Medicaid to review my case, but my Medicaid should finally be ending and I signed up for marketplace coverage for December.
I understand that I will have to pay back my tax credit for the two months and this will be resolved using form 8962 and form 1095-A.
My question is, self-employed people can use premiums they paid for healthcare to reduce their taxable income, would I be able to do that for the two months I had both Medicaid and marketplace? It doesn’t seem like something I should be able to do, but I’m not sure. And would it be the whole amount for the two months since I shouldn't have received the tax credits?
I’ve tried reading on this topic and I’ve read is that people who are self-employed cannot do this if they had or were eligible for an employer-subsidized health plan. I was not able to find anything regarding overlapping Medicaid and marketplace coverage.
Any help is greatly appreciated.
