It's open enrollment time again and year end and taxes are right around the corner—yikes! For about 80% of taxpayers, reporting their health insurance this year again will literally be as easy as checking a box with TurboTax. This handy infographic can help you keep track of key dates for 2016 Marketplace Open Enrollment to stay on top of health insurance options this year.
Taxpayers who have insurance through their employer, a government program such as Medicare or Medicaid, or other private insurance may receive a 1095-B or 1095-C form. Boom. Done. Easy. You do not need these forms to report insurance and file taxes—they are for your records only. But what if you've had a major life change? Maybe you've moved across the country and changed jobs? Maybe someone has gotten laid off and you lost insurance or your insurance changed? That reporting may not be as easy.
Understanding your options and the financial implications to those options is imperative to managing your finances and making sound, responsible financial choices. If you don't have health insurance, you pay a fee on your Federal income tax return for the year. Typically you can enroll once per year, but you may qualify for a Special Enrollment Period due to certain life changing events.
TurboTax offers a free suite of tools to help people understand how the Affordable Care Act (ACA) will affect their taxes. TurboTax doesn’t charge tax payers any extra fees for health care-related forms to comply with the ACA. At TurboTax, they believe American taxpayers should spend their hard-earned money on keeping their families healthy, not on having to pay to show they are complying with the health care law.
As with all tax situations, TurboTax simplifies the tax filing process, and reporting your health insurance is no different. You just answer a few basic questions about your life—they do all the rest. Reporting your health insurance status in TurboTax is so straightforward, you can easily do it on your smartphone or tablet.
The Affordable Care Act (ACA) and Taxes
This is only the second year taxpayers will be reporting their health insurance status on their tax returns, and for most, it will be another year when they will just need to check a box with TurboTax to indicate they have health insurance. Easy. Maybe. Most taxpayers are familiar with this simple process from last year and know what to expect because last year, 8 out of 10 households only had to check a box in TurboTax simply indicating that they had health insurance. This year, TurboTax anticipates that this tax year will be just as simple of an experience for those tax payers.
The ACA and Forms
There are three forms you could receive regarding your healthcare coverage. Form 1095-A, 1095-B, and 1095-C.
Taxpayers who purchased a health insurance plan on healthcare.gov (or through their state health insurance marketplace) will receive Form 1095-A, which confirms their coverage, premiums paid, and any subsidies they received to help pay for health insurance. In TurboTax, entering 1095-A information is as simple as entering a W-2. When prompted, taxpayers will just need to enter the information on their 1095-A into TurboTax and we do the rest. TurboTax customers do not see any other forms. This year TurboTax has made it even easier to report this information with a PDF upload.
Taxpayers who have health insurance through an employer, a government program such as Medicare or Medicaid (outside of the Marketplace), or other private insurance company may receive a tax form from their employer or insurance provider (1095-B or 1095-C) confirming their coverage. According to the IRS, you don’t need to wait for these forms to file your taxes. Taxpayers will simply review the forms for accuracy and keep the 1095-B or 1095-C for their records.
TurboTax Tools & Resources
TurboTaxHealth.com is an easy and helpful resource for people to learn about the effect of healthcare policies on their taxes. TurboTax offers a suite of free tools and calculators that make it super easy to learn how the ACA might impact your taxes and finances. You can input various information to see how it affects your situation. For instance,
- Easily understand if you qualify for assistance to pay for health insurance;
- See if you qualify for exemptions for going without insurance; and
- Whether you will be responsible for a penalty—and how much—if you choose not to purchase health coverage.
I was selected for this opportunity as a member of Clever Girls and the content and opinions expressed here are all my own.