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VR
Level 2

Marketplace Insurance and Medicare

I had been covered under the ACA from 01/01/2018 through 05/31/18. Towards the end of May, after waiting for two years, I finally received a permanent disability determination through the Social Security Administration. I stopped paying my premiums with the ACA as of 06/01/2018 as I qualified for Medicare. I also received a lump-sum payment from Social Security for approx. 2 years. It now looks as though we have to pay back all of the credit to the ACA? Is this correct? I claimed bankruptcy three years ago this month and we cannot afford to pay this back. We weren’t expecting this. Can we claim a hardship? Or are there any credits we can qualify for since we are both disabled and on Medicare? Thank you for your help.

(PS: Because of the lump-sum payment, we don't qualify for the Marketplace credit)

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Accepted Solutions
MarilynG
Level 11

Marketplace Insurance and Medicare

There is an additional credit for being legally blind, but unfortunately not for any other type of disability. 

If your lump-sum payment was for multiple years, be sure you indicated what the 2018 amount was so only that is being considered. 

There are 'Caps' on the amount you have to pay back, based on what % of the FPL (Family Poverty Level) your income fall in.

Here's info on that:

https://www.irs.gov/affordable-care-act/individuals-and-families/four-things-to-know-about-advance-p...

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4 Replies
MarilynG
Level 11

Marketplace Insurance and Medicare

There is an additional credit for being legally blind, but unfortunately not for any other type of disability. 

If your lump-sum payment was for multiple years, be sure you indicated what the 2018 amount was so only that is being considered. 

There are 'Caps' on the amount you have to pay back, based on what % of the FPL (Family Poverty Level) your income fall in.

Here's info on that:

https://www.irs.gov/affordable-care-act/individuals-and-families/four-things-to-know-about-advance-p...

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

View solution in original post

VR
Level 2

Marketplace Insurance and Medicare

That's what I thought!  But I do have one question.  Do I subtract the amounts for years 2016 and 2017 from the total I received in 2018 and enter the difference as my net benefits for 2018, even though my SSA1099 shows the total for all three years box 5?  This is not explained when I am going through the steps.
MarilynG
Level 11

Marketplace Insurance and Medicare

Yes, these amounts are not taxable income for you in 2018. TurboTax asks the amounts/years when you indicate 'lump sum payment'.
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VR
Level 2

Marketplace Insurance and Medicare

But why doesn't Turbo Tax doesn't subtract the lump sum payment from the total shown on box 5 of my SSA1099?  It shows me to break down my lump sum payments for each year, however, it doesn't seem to adjust the amount when asked about the figure in Box 5 of my SS1099.  I subtract this myself, correct?
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