Self Employed 1095-a column b blank won't accept 0 as an answer

[dnathan13]

My wife is self employed in home daycare. I am a teacher with benefits. My work health insurance is free for me, but very expensive for my wife so we use the health insurance marketplace for her coverage.  She received a 1095a with a black ($0) column B. In turbo tax it will not allow an answer of $0 and sends me to the marketplace tool to get an updated column B number.  On the tool we get to this section: 

Include in your household only members to whom ALL of the following apply.
The person:

• Will be included in your tax family for 2022
• And was enrolled in a 2022 Marketplace plan
• And wasn’t eligible for coverage outside the Marketplace for at least one of the months they were enrolled in a Marketplace plan.
  • Note: "Coverage outside of the Marketplace" includes Medicare, Medicaid, and job-based plans. It doesn't include individual plans bought outside the Marketplace.

She was technically eligible for coverage through my job-based plan, but it is expensive. Under 2022 tax rules it counted as "affordable" but in 2023 that changes and we are premium tax credit eligible.  The problem is for 2022 we do not fit that description so the tool won't give her an amount.  If we fake it and say she was eligible it will give an amount and says we should get a tax credit back. 

Am I understanding my tax situation correctly in 2022 that I should NOT be PTC eligible and therefore can't fill out that Healthcare.gov tool?

How do I handle this in turbo tax if it won't allow $0 in column b?

[Critter-3]

You MUST fill in column B from the figures from the ACA ...  https://www.healthcare.gov/tax-tool/#/premium-tax-credit

[dnathan13]

But when I get to the question I indicated in my OP the answer should be 0 because my wife is eligible for health insurance through my employer. If I enter a 0 it will not move forward in the tool that you linked.

[dnathan13]

From my understanding, we should NOT be eligible for the tax credit in 2022 because my wife could have gotten coverage through me because of a loop hole saying her coverage was "affordable" (even though it was outrageous) since my coverage was provided to me for no cost.

TurboTax does not provide a way to enter a 1095a and not seek the credit.

Should I leave the entire 1095 portion blank like we never got the 1095a since we are not eligible for the credit in 2022?  We will be eligible in 2023 because of a rule change, but from what I see on the IRS site it is not retroactive to previous years.

[Critter-3]

Yes but ... she could get the credit because the insurance was unaffordable : 

Affordability and minimum value.

Even if you had the opportunity to enroll in coverage offered by your employer that qualifies as MEC, you are considered eligible for an employer-sponsored plan (and cannot get the PTC for your coverage in a qualified health plan) only if the employer-sponsored coverage is affordable (defined later) and the coverage provides minimum value (defined later). Your tax family members may also be unable to get the PTC for coverage in a qualified health plan for months they were eligible to enroll in employer-sponsored coverage offered to them by your employer but only if the coverage qualifies as MEC and was affordable and provided minimum value for you. In addition, if you or your family member enrolls in the employer coverage that qualifies as MEC, the individual enrolled cannot get the PTC for coverage in a qualified health plan, even if the employer coverage is not affordable or does not provide minimum value.

https://www.irs.gov/publications/p974#en_US_2019_publink100023181

[dnathan13]

Loop hole from 2022 and before that is fixed for 2023 and beyond:

https://www.irs.gov/publications/p974#en_US_2021_publink100023214

How to determine if the plan is affordable.

Your employer coverage is generally considered affordable for you and for a family member if your share of the annual cost for self-only coverage, which is sometimes referred to as the “employee required contribution,” is not more than 9.83% of your tax family’s household income for 2021. For 2022, this threshold will decrease to 9.61%. Self-only coverage is used for this calculation even if you have a spouse or dependents and therefore would enroll in coverage that is not self-only coverage (for example, family coverage). 

Since the self-only coverage is free for my it disqualifies our entire family for the credit in 2022. This has been remedied for 2023 and now I fill out a special worksheet when we applied for coverage, but it is not retroactive to 2022 and therefore I don't qualify.  It was a loophole that cost myself and around 5 million other taxpayers to not receive the credit despite our income qualifying.

How do I enter this in turbotax? Or do I not enter the 1095 since I am not qualified for the credit anyway.

Do I need to reach out to turbotax directly?

[DMarkM1 · Accepted solution]

It appears from IRS Publication 974 that, assuming there was no Advanced Premium Tax Credit paid and showing on the form 1095-A, you would not need to file the form 8962.  Therefore you would not enter form 1095-A information.  Below is an extract from Publication 974.  

As you note, she was eligible for the "affordable" employer coverage based on the self-only premiums.   

You must file Form 8962 with your income tax return (Form 1040, 1040-SR, or 1040-NR) if any of the following apply to you.

• You are taking the PTC.
• APTC was paid for you or another individual in your tax family.
• APTC was paid for an individual you told the Marketplace would be in your tax family and neither you nor anyone else included that individual in a tax family. See Individual you enrolled who is not included in a tax family under Lines 12 Through 23—Monthly Calculation in the Form 8962 instructions.

[Critter-3]

I cannot believe that the insurance thru your job  was affordable... if it was why did you go to the ACA for a better rate?  

[dnathan13]

I answered this above...

According to the law prior to 2023, they based affordability on the cost for the employee only. So my insurance was free (and therefore considered affordable for the entire family), but to add my wife was over $100 more per month than going through the marketplace even with no tax credit.  It was a loophole in the system.  Example numbers for the health insurance costs through my employer:

Insurance for me only = $0 covered by the company and therefore making our entire family ineligible for tax credits

Insurance for me and kids only = $300 taken out of my monthly paycheck

Insurance for me and wife only = $400 taken out of my monthly paycheck

Insurance for me and family = $1000 taken out of my monthly paycheck

Insurance for my wife in 2022 through the marketplace = $370

After checking costs in every possible way our most cost effective answer was the kids and I through my work and my wife on a marketplace policy.

In 2023 this has changed. Now there is a special section to fill out on the marketplace and we now qualify for the tax credits. My wife's cost has dropped by $300 due to the tax credit loophole being closed.