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Importance of Form 1095-A
Form 1095-A - Health Insurance Marketplace Statement will be received by approximately 10 million individuals that obtained their health insurance at a Federal or a State Marketplace. This form is needed to complete Form 8962 - Premium Tax Credit, and for those who received a subsidy, to complete the reconciliation of the subsidy with the actual credit.
The 1095-A should be received by:
A copy of the Form 1095-A will be available online in January (via their account on healthcare.gov) for those who used the Federal Marketplace. It may also be available online for those who used a State Marketplace.
Also, any taxpayer who received a subsidy must include Form 8962 with their federal tax return. If it is not included with the tax return the processing of the return may be delayed.
Health Care Coverage Exemptions
Many individuals who did not have health insurance for all or part of the year may qualify for an exemption. Therefore, it is important, before any penalty is calculated, that you determine whether they may qualify for a health care coverage exemption.
If an individual qualifies for a health care coverage exemption you must complete the applicable parts of the Form 8965 - Health Coverage Exemptions and include it with their federal tax return.
To see a full listing of the exemptions and whether the applicable exemption must be applied for at the federal Marketplace or can be requested when the federal tax return is filed click here. If an individual needs help determining whether they qualify for an exemption, a Find Exemptions tool is available on the healthcare.gov website.
Individual Shared Responsibility
If it is determined that an individual does owe a penalty it is calculated as the greater of:
The maximum family dollar amount is $2,085.
The penalty amount is limited to the annual national average premium for a bronze level health plan available through the Marketplace, which is $2,676 per individual ($223 per month per individual), with a cap of $13,380 for a family with five or more members ($1,115 per month). See pages 15 - 19 of the 2016 Form 8965 instructions for more information on how the penalty is calculated.
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