Challenge for Tax Forms

Many Americans won’t forget the federal agency that had delays in launching the health insurance website just last fall. Any defects on this one could cause a possible delay for tax refunds to many Americans.

Due to the complex connections between the new health care law and income taxes, the Department of Health and Human Services will be obligated to send out new tax forms next year to more than 7 million Americans who are enrolled in the Affordable Care Act. The process is similar to W-2s but for people receiving health insurance tax credits under the new health care law.

The forms are called 1095-As and list the people in each household that has health coverage as well as calculate the amount that the government paid each month to subsidize the insurance premiums.

The delay in forms past the January 31 deadline, will cause some people to wait to file tax returns and collect their awaiting refunds.

Next year will be the first time the Affordable Care Act’s law coverage expansions and the tax system will be intertwined. More than 7 million people who received tax credits from the new health law will have to report to the Internal Revenue Service and set up accounts in order to verify that the consumer received the amount that they were legally entitled to.

Consumers will have to report any life changes including becoming married, having a child, and income changes as soon as possible. For people who received too big of a subsidy for health care in 2014, repayment will most likely come from tax refunds.

The IRS will be snatching refunds from people who estimated a lower income than they received in 2014. Unless the consumer reported the change right away, they will owe money. Having more overtime or a bonus will have an impact on subsidies.

According to the IRS, the healthcare exchange will send a statement showing the amount of an individual’s premiums and credit payments by January 31, 2014. The statement will help consumers balance the advance credit payments with the amount of the actual credit.

The IRS reports that when taxpayers file next year, they will have to subtract any advanced payments they received during 2014 from the amount of credit calculated on their tax return. People who were eligible for higher amount of credit than they received will result in a increased tax refund or a decrease in amount of taxes they will owe.

The IRS reports that they have the same authority to get money as it does with tax liability or balance due. This can include deducting the amount of refund a taxpayer would receive in order to satisfy debt.

The government is concerned that most people are unaware of reporting these type of changes and millions of people will be repaying money the next upcoming year.

Taxpayers can report changes by calling the marketplace call center at 800-318-2596(TTY: 855-889-4325) or by going online to, logging into your account, click on the link for existing application and choose “Report a life change”.

Any questions or concerns about the tax credit and your tax return should be resolved at at , the website set up by the IRS to address issues regarding the health care law.

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