This year, the affordable care act will affect your tax return. If you are one of the millions of Americans who purchased health insurance through the marketplace, you may qualify for tax assistance that can help lower the amount of your monthly premiums. The premium tax credit allows taxpayers to choose whether to pay the cost of their monthly insurance premiums up front, using the premium tax credit as an advance payment. You can select to use the tax credit when you purchase your insurance through the marketplace, in which case the credit amount is estimated as a result of information about your household that you supply.
When you file your taxes, you will be expected to reconcile the amount of the advance credit you received with the actual amount you qualify for. Form 8963, Premium Tax Credit (PTC) is provided by the irs for the purposes of determining the difference in the credit allowance and for claiming the credit. If you receive more as an advance credit than you are eligible for, totaled once your actual income is accounted for, then you will have to repay some of the excess at the time you file your return. There are some caps that limit the amount you may have to pay back.
Anyone who purchased health insurance through the health insurance marketplace will receive the Form 1095-a, health insurance marketplace statement by early February. This form has everything you need (relating to your health coverage) to file your taxes, such as the name of the coverage provider, your enrollment dates, monthly premium amounts for your plan, and amount of the advance premium tax credit you opted to use. This form will help you complete the premium tax credit portion of your tax return.