1095-A and dependent child filing his own tax return

[Nava]

I have read some discussions but still confused about filing 8962.

A family has a 20 yo son who is a student and has his own $10k income.  They claim him as a dependent and he also filed his own tax return. They received 1095-A with monthly advance payment of PTC listing him and his parents.

Can they file 8962 only with parents' return? Or there is a more beneficial way to file, like allocating part to his own return?

Thank you!

[Critter]

The 1095-A is reported on BOTH the parents & the child's return  AND the advance credit can be prorated anyway you wish as long as the total between the 2 returns is 100% .... SO  both returns need to be completed using a combination on each return that totals 100% ... for instance 0% on the parents + 100% on the child  OR   50% on each  OR  25% + 75%  OR  any other combination that works best for BOTH returns combined.  

I highly suggest you use the Downloaded Deluxe version ( Basic if you don't need a state return) so you can complete both returns and keep trying different % combinations until you find the best one. 

[Anonymous]

on your 8962, you must include his modified AGI (MAGI) on line 2b.   for your son that would most likely be his adjusted gross income unless he receives social security or has other exempt income.  in that case refer to 8962 instructions for worksheets to compute MAGI

https://www.irs.gov/pub/irs-pdf/i8962.pdf

[Brian T2]

The IRS instructions explicitly say that a dependent's MAGI is included in the household MAGI if the dependent is REQUIRED to file a tax return (not just filing to claim refund of withholding). This kid has $10,000 of income so is likely not required to file and would not be included in the household MAGI. Turbotax simply does not handle this correctly so causes folks to overpay their taxes.

[palfonso2]

I'm following instructions from this post and I'm trying to report the form for BOTH the parent and the dependent, using the 0%  and 100% combination (0% for the parent, 100% for the dependent) as suggested.

However, as the parent, I'm getting the error "Value should be greater than $0" when trying to enter this amount in Turbotax.

Is it possible to let the dependent enter the %100 (as he is entitled to the Premium Tax Credit) while the other return (from the parent) is just empty with $0 amounts?

[AbrahamT]

Being the fact that a dependent (child included) is not entitled to the premium child tax credit at all, see HERE Q5,  you will simply input the total amounts on that Part A, namely; the Monthly Premium Amount, monthly premium of the SLCSP and the third column of the Monthly Advance Premium Tax Credit directly on the parents return "without" allocating any portion of it to the child. On the next screen, don't enter anything relating to sharing this policy with anybody else.

Naturally, nothing will be entered for the child on the child's tax return at all.

[Edited 02/12/2024|9:31 pm PST]

[palfonso2]

Thank you!

What about this field:

"I have at least one dependent on my taxes who's filing a separate return".

Should I check it too? This seems to be true in my case, as I'm claiming him as my dependent. What is the difference between this field and the other one?

Also, I would like to clarify that my dependent is filing a separate return with a MAGI of 13000 and the form 1095-A is on his name only (with his Premium Tax Credit).

[DawnC]

You do not need to allocate anything since you will be claiming him as a dependent.  He won't be able to enter the 1095-A if he indicates he can be claimed by someone else.  Enter the 1095-A on your return only, and don't check the ''I share this policy'' box.  

You are eligible for the premium tax credit if you meet all the following requirements. You:

• Have household income that falls within a certain range.
  • If you, or your spouse (if filing a joint return), received, or is approved to receive, unemployment compensation for any week beginning during 2021, your household income is considered to fall within this range.
• Do not file a tax return using the filing status of Married Filing Separately.
  • There is an exception to this rule that allows certain victims of domestic abuse and spousal abandonment to claim the credit using Married Filing Separately; for more information, see the Premium Tax Credit questions and answers.
• Cannot be claimed as a dependent by another person.
• Meet these additional requirements: In the same month, you or a family member:
  • Have health insurance coverage through a Health Insurance Marketplace for which the share of the premium not covered by advance credit payments is paid by the due date of your return.
  • Are not able to get affordable coverage through an eligible employer-sponsored plan that provides minimum value.
  • Are not eligible for coverage through a government program, like Medicaid, Medicare, CHIP or TRICARE.