When will TurboTax be updating the forms for the updated tax implications for health insurance on the exchange? Per section 9662, overpayments are not taxable for 2020.

[Beccapooh88]

My income was higher than expected due to strange occurrences due to COVID, so I ended up having a rather large tax burden this year.  Per the ARP, I won't have to pay that penalty, for 2020.  I'm wanting to know when TurboTax's forms will be updated to show this new rule.

[Irene2805]

Please see this TurboTax Help article for information:  Can I get a health insurance penalty exemption for 2020?

[Beccapooh88]

But, I'm still getting hit with the penalty.  I even deleted the form and re-entered it all.  My tax burden went down when I deleted it and went right back up when I input it again.  Something's wrong here.  It's the exact same amount it's been since I input my tax information back in January, long before the ARP even existed.  Suggestions? 

[ColeenD3]

It takes time for the IRS to determine how to structure new laws and it then takes time for software to be written to handle the changes. This is not available yet. The bill was passed 6 days ago.

For the 2020 plan year, the answer is no. This is due to the American Rescue Plan (ARP), which was signed into law by President Biden in March 2021. The ARP provides a one-time relief from excess premium subsidy repayments, but it’s only for the 2020 plan year. It’s challenging to accurately project annual income in a normal year, but the COVID pandemic made it particularly challenging for 2020. To address this, Section 9662 of the ARP clarifies that for 2020 only, people do not have to repay excess premium subsidies. This is true regardless of whether their total household income exceeded 400% of the poverty level, and it’s true regardless of the reason their income ended up being larger than projected.

[Beccapooh88]

Hence, the question I asked was WHEN would the update be completed on TurboTax's end.  I recognize that it was JUST passed and it will take time.  I was simply asking the question of "when".  Even an estimated time frame would be helpful, i.e. a week, not until AFTER the April 15th deadline, thus requiring and extension request on my part.

[ColeenD3]

There is no way to know at this point. We are still waiting on the IRS. Since you can still file the extension on April 15, you will have some sort of answer before then.

[tustinbells]

This article has nothing to do with the very recently passed American Rescue Plan.

[KathrynG3 · Accepted solution]

TurboTax is depending on the IRS for updates for when, as well. It is very likely the updates will be in place before April 15, 2021. The TurboTax engineers are working as fast as possible to update the software with the changes.

At IRS: Premium Tax Credit: Claiming the Credit and Reconciling Advance Credit Payments

Check Back for Updates to this Page

We’re reviewing the tax provisions of the American Rescue Plan Act of 2021, signed into law on March 11, 2021. Taxpayers who filed a 2020 tax return and reported an excess advance premium tax credit repayment on Line 29 of Form 8962, Premium Tax Credit, should not file an amended tax return only to get a refund of this amount. The IRS will provide more details soon. For the latest updates, check IRS.gov/coronavirus.

[Krivs]

What is the point of giving a partial update waiving the $10,200 UI if the waiver of repayment of ACA subsidies isn't included ? I need to make estimated quarterly payments by April 15th and will be applying this credit to this quarter. How hard is it zero out the total? Some of us have busy schedules and are doing taxes for several people and need to know WHEN IS THE UPDATE?? Please provide an estimate.

[Cynthiad66]

We do not have an estimated date of completion.  We are working on the IRS' schedule.  The UI Exclusion information is that do not amend if you have filed already and the TTO software has been updated to compute the Exclusion.  Pro-Series has been updated but CD/Download has not been updated.

IRS has advised that you should not amend your return for the Advanced Premium Tax Credit as they are working on how to treat it.  No other provision for software has bee provided.  TurboTax cannot just create our own workaround, it has to work with the IRS software.

[Krivs]

Please provide more information on when we can expect this update. If the IRS can't figure this out then my estimated quarterly payment should also be extended as  I plan to apply my over payment to this year .

[BillM223]

@Krivs

"Please provide more information on when we can expect this update. "

As was stated above, until the IRS gives us guidance on how to implement the changes to the excess PTC repayment, TurboTax cannot begin to give you an estimate of when the changes will be ready in TurboTax.

For example, the law says that the repayment of excess Premium Tax Credit is waived for 2020. You might think that this is clear, but what about the collateral issues?

Self-employed taxpayers who have to repay excess PTC can apply that to the Self-employed Health insurance deduction. Will that still be true when the taxpayer doesn't have to repay the excess PTC? Congress didn't say so the IRS has to decide. Furthermore, the Self-employed health insurance deduction and the Self-employed SEP, SIMPLE, and qualified plans deduction have peculiar interactions where the value of one affects the other. Will this change? Again, Congress does not say so the IRS has to consider all the possibilities and issued rules on how we are to proceed.

TurboTax will get the guidance from the IRS and will work as quickly as possible to implement the changes and test them.

But TurboTax is no more able to give you a estimated schedule before the release of the IRS guidance than your mechanic can give you an estimate on an unknown problem before he/she sees your car.

[9squam1SH4]

When will TurboTax update the Tax Forms so the penalty is waived for the 2020 health insurance exchange?

[DoninGA]

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@9squam1SH4 wrote:

When will TurboTax update the Tax Forms so the penalty is waived for the 2020 health insurance exchange?

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As previously stated on this thread "We are still waiting on the IRS".

IRS statement - https://www.irs.gov/affordable-care-act/individuals-and-families/the-premium-tax-credit-the-basics

We’re reviewing the tax provisions of the American Rescue Plan Act of 2021, signed into law on March 11, 2021. Taxpayers who filed a 2020 tax return and reported an excess advance premium tax credit repayment on Line 29 of Form 8962, Premium Tax Credit, should not file an amended tax return only to get a refund of this amount. The IRS will provide more details soon.

[Tanya14]

Hi, Is there a one stop shop site on TT to let clients know the STATUS for EACH CHANGE happening to the TT software from the American Rescue Plan? Or, can this Spotlight Topic be updated with each status? We are all confused on what is still outstanding to update on the TT side. 

For instance, I know that the $10,200 Unemployment change is complete, but what about the Advance Premium Tax Credit change? And, having one site to go to for any update would help us figure out if we can file our taxes.

Thank you!