Help is on its way for health insurance confusion at tax time

health insurance disclosure tax penalty

Private tax services and federal officials are already assisting consumers in filing before the April deadline.

The confusion that is expected to result from the health insurance requirements that started last year is not going to leave taxpayers without a way to know that they have filed properly, as federal officials and private tax preparers have already begun offering assistance to consumers.

This support is meant to make sure that questions will be answered ahead of the April deadline for tax filing.

For approximately 75 percent of taxpayers across the country, all that will be required is that they check a box that confirms that they did have the health insurance that is required by the individual mandate of the Affordable Care Act during 2014. This, according to the Department of Health and Human Services. That said, for Americans who were recipients of subsidized coverage through the health care reform, last year, and those who chose not to enroll in a plan, will need to undergo a process with greater complexity.

There will be people who will be confused over the health insurance component of filing their taxes.

health insurance care reform taxAccording to the CEO of H&R Block, Bill Cobb, some people will be confused by this. He added that “The majority of people still don’t understand the intersection of the Affordable Care Act and taxes.”

While there are some taxpayers who will be capable of claiming an exemption from possible penalties if they show that they were unable to afford a health plan, there will be others that will be required to reconcile the assistance that they received financially along with their income. Additionally, there will be some who chose not to obtain coverage and who will need to pay a fee as a result of that choice.

Americans who enrolled through the exchanges for health insurance coverage in 2014 were required to provide an estimate of their earnings for that year. That figure provided most enrollees with the largest possible premium tax credits that would make it possible to offset the cost associated with their coverage. Cobb said that it is possible that people will forget that they did not just receive “free money”, but that the purpose for those funds was coverage. He added that “There is not broad awareness that this was an advanced premium tax credit and not a subsidy.”

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