MEDFORD, Ore., Feb. 23, 2015 /PRNewswire/ -- With the introduction of the Affordable Care Act (or Obamacare) will you have a credit or a penalty on your tax return this year?
Will you have a credit? This credit is called the Premium Tax Credit and it may be available if you purchased your health insurance through the Marketplace (The Marketplace is the name used by the government to describe where people without health care insurance can find health insurance options and also purchase insurance).
If you qualify for this credit, you will need to claim it on your tax return. The amount of the credit will depend on a number of different circumstances. You also must have received form 1095-A from the Marketplace in order to claim the credit. Be careful though, some have already received the credit in the form of an advanced payment. When this occurs you could be responsible to pay some of the credit back if you received too much!
Will you have a penalty? Then penalty is called The Shared Responsibility Payment and it is for anyone without minimum essential health care coverage or for those that do not qualify for a health care coverage exemption. To put it simply, if you don't have health insurance…you will pay a penalty. But don't worry, there are some exceptions.
Will you receive the credit and pay the penalty? Possibly. If you purchased health care coverage through the marketplace but not at the beginning of the year, you may have a credit for purchasing the health care and a penalty for the months that you did not have health care.
Will you have neither a credit nor a penalty? This is possible as well. If you purchased your own health care coverage outside of the marketplace, or if you had health care coverage provided by your work, then you will not qualify for the credit and will not be subject to the penalty. This is because you had health care insurance for the entire year.
The affordable care act can be very complex, it may prove helpful to seek a well-trained tax professional to help navigate this complex new law. For more information, visit http://listotax.com/pressinf/
Clayton Cathcart is an Enrolled Agent with the IRS and is the President of Listo Tax Solutions. He can be reached at 888-99-LISTO or email at [email protected].
SOURCE Listo Tax Solutions
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