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January 2015 St@teside

Health Care Reform and Taxes: Preparing for the 2014 Tax Season

As individuals begin to prepare the necessary documents to submit to the Internal Revenue Service (IRS) this tax season, they will need to be prepared to address an additional question in that process. Filers must prove they have health insurance or face a penalty. For 2014, the penalty is either $95 per uninsured person or 1 percent of an individual’s household income, whichever is greater.

A majority of people whose coverage remains unchanged with stable employer coverage will need to check a box verifying they had health coverage throughout 2014. However, those who received coverage through a health insurance marketplace will have to attach a 1095-A form, which will provide information on the total monthly premium that an individual paid, as well as the tax credits received. The IRS will use this information to determine whether individuals have been receiving the appropriate tax credit based on their household income in 2014.

The health insurance marketplaces are responsible for sending the 1095-A forms to consumers, and they must be sent out by January 31 so that consumers will receive them in early February. While the marketplaces work on sending out the 1095-A forms, the federal government, states, and tax preparers have been conducting outreach and developing resources to help prepare consumers for this new filing requirement. Below is a sampling of the latest ACA-related tax resources.

Federal Resources:

State-Based Marketplace Resources:

Additional Resources: