Affordable Care Act could change your tax return this year
RICHMOND, VA (WWBT) - Some taxpayers will face a penalty on their taxes this year if they don't have health insurance. And those who got a subsidy for insurance may have to pay part of it back. Those are just a few changes you may discover when you file your tax return this year, as the Affordable Care Act required most people to have insurance last year.
The first change you'll notice is that you will have to send a 1095 form in with your tax return. If your employer provides your health insurance, they'll give you a 1095-C. If you bought health insurance on your own, you'll get at 1095-B. And if you bought your insurance through the Healthcare.gov Marketplace, or a state exchange, you'll get a 1095-A.
Also, if you bought it through the Marketplace, you'll may have qualified for a subsidy, or tax credit.
"They did get a credit which is basically a subsidy to assist with paying their health insurance premiums," Patricia Griswold, president of Liberty Tax Service, said.
That subsidy could change the amount of your tax return.
"If they received too much subsidy through the year, they are going to have to pay some of that back when they file their taxes. So it's going to reduce their refund," Griswold said.
But if you did not get a subsidy, you may get a tax credit that could increase your tax return. And if you did not have or buy insurance last year, you will face a penalty.
"The penalty this year is going to be $95, or $285 for a family of four, or 1 percent of their modified adjusted gross income," said Griswold.
But you may be able to claim an exemption from the penalty, for example, if you were uninsured for less than three months, or have a previous medical bill you can't pay.
Adds Griswold, "If they were homeless, evicted, facing eviction, facing foreclosure, or just had difficulty getting insurance, there is a chance they could apply for an exemption."
Open enrollment on Healthcare.gov ends February 15.
Copyright 2015 WWBT NBC12. All rights reserved.