Why Failing To File A Tax Return For 2014 Might Affect Your Health Care Coverage

The IRS has announced that individuals who received an Advanced Premium Tax Credit for their 2014 coverage have until July 31st to file a tax return for 2014. Failing to file by the 31st could affect eligibility to receive advance payments in 2016. The Advanced Premium Tax Credit is not paid directly to the taxpayer, it is actually an amount that reduces the insurance premium paid each month. Most taxpayers may not even realize they received the credit. When the tax return is prepared there is a reconciliation to determine if the amount of credit was accurate and if there is any variation the taxpayer will either receive some additional credit or will pay back the difference. The reason for a correction would be potentially due to a variance in the amount of income ESTIMATED ON THE APPLICATION versus the actual amount received or a change in circumstances such as getting married.

The Advanced Premium Tax Credit is only available to those individuals who received coverage through the marketplace. If you have coverage from outside of the marketplace you are not affected by this warning. If you took advantage of filing an extension you are urged to file the return prior to July 31st to avoid any potential delays in 2016.rather than waiting for the October 15th deadline.