It’s no secret that a many tax payers are confused about ACA (Affordable Care Act). Not only that, but it seems like everyone is. When tax season 2014 hits, there is a good chance that you will have to bare some bad news to your clients. As a professional tax service here is some info you can pass along to your clients before tax season hits, this should help avoid some frustrations for the both of you.
Are you one of the millions of taxpayers using your tax credits towards your health-insurance premiums? If so, it is very important that you remember that these credits are figured specifically for you based on your household income and number of dependents. If you receive a pay raise during the year, or if you become unemployed this will affect the amount of tax credits you receive. Also, if add a new addition to your family this will affect your credits as well. Remember, the amount of credits that you receive for 2014 are estimated, so they will be “trued-up” at the end of the year. After your credits have been finalized, if you used more credits than you earned then you will owe the difference. If you were to receive a tax refund, the amount you owe will be deducted from your return.
One of the new and very important forms that taxpayers will receive this year is the 1095-A, B and C. In order to complete your tax returns this year, we have to have ALL copies of form 1095-A. These forms will allow us with the information needed to report your health insurance coverage, and calculate any credit or penalty. If you do not receive any 1095 forms for this year, please bring the following information with you so we can compute your return.
- All Health Care Providers for the year
- Family members covered by this health care plan for the year
- Which months were covered this year
- The county of residence for the year
- Signed health insurance form
Let your clients know if they have questions, they can ask you, visit the IRS website or HealthCare.gov
