Your Yearly Federal Taxes & Your Health Insurance

If you had health insurance coverage in the last calendar year you may need to indicate this when filing your yearly federal taxes.

Please be advised, we are not tax advisors and cannot advise you on your taxes however we are happy to provide you important information to consider when preparing your taxes. If you need assistance, please contact your tax advisor and reference this information upon consultation.

1. What you should know about your health insurance coverage.
If you enrolled in a health plan in the last calendar year through REALTORS® Insurance Marketplace, another marketplace, or a State or Federal Marketplace, you will receive a tax document in the mail – called Form 1095-A.  This form will come directly from the carrier of your major medical insurance.

Form 1095-A will include information you will need in order to complete your annual federal tax return. When this form arrives in the mail be sure to keep it with your tax records, like your W-2. Wait to file your taxes until you receive Form 1095-A in the mail.

Note: carriers will only send Form 1095-A for qualified major medical insurance plans. If you had other health care coverage (i.e. through your employer, Medicare, Medicaid or Children’s Health Insurance Program (CHIP) ) you may get a different form, or none at all.

If everyone in your household, you included, had coverage for the entire year through one of these other health care programs you will need to check a box on your federal income tax form indicating that you had coverage for the full calendar year.

2. What you should know if you received financial assistance.
If you are among the millions of Americans who received financial assistance to help lower the cost of your health insurance premium you MUST file a tax return and report the amount of financial assistance you received.  If you do not file a tax return for the year you received assistance you will not be able to receive the same financial assistance in the future.

3. What you should know if you did not have coverage in the past calendar year.
Having health insurance is the law. If you were able to afford health insurance, but you chose not to enroll in coverage you may be required to pay a penalty. If you were not able to afford health insurance due to hardship then you may be eligible for an exemption.

The Penalty: If you chose not to have health insurance, or had a gap in insurance for more than 1-2 months you may be subject to a tax penalty. The penalty for not having health insurance coverage in 2015 was up to 2% of your annual household income and for 2016 the penalty has increased to up to 2.5% of your annual household income.

 Exemptions: There may be certain circumstances where individuals are unable to afford health insurance and can receive an exemption. More information on determining if you may be eligible for an exemption can be found here. Note: if you earn an exemption you will not have to pay the penalty, however you will not have health insurance coverage either.

4. Additional help.

  • Our Enrollment Specialists can also assist you by providing information on how your Marketplace coverage will affect your taxes, just give them a call: 877-267-3752.
  • For those who qualify, the IRS has free software available for assistance in filing federal taxes. To determine if you qualify click here.
  • You may also be able receive in person assistance. To see if there is a location available in your area click here.
  • More information regarding these topics can be found here.
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