The good, the bad and form 1095-A

March 30, 2016 by Jean Lee Scherkey, EA
Woman relaxing by a lake

The 2015 year left my wallet as empty as my mind as I spent the year living as a traveling poet and yoga enthusiast. Counted together, the income from my odd jobs was below my filing requirement. It looked like I would not need to reach out and touch Uncle Sam this year. Ah, a year sans Form 1040! Can a yogi poet ask for more? Like my limbs after an hour of yoga, a tangled paradox emerged. Just when I thought I escaped those 1040 blues, I heard the tapping of Form 1095-A in my mailbox.

Form 1095-A, Health Insurance Marketplace Statement, is issued by the federal and state healthcare marketplace exchanges. Anyone who enrolled in healthcare insurance coverage via one of these marketplaces, whether for themselves or their dependents, will receive Form 1095-A. Generally all Forms 1095-A are received by February 1st (anyone missing this form may contact their exchange to request a copy). Obtaining healthcare coverage for yourself or any of your dependents via your health insurance exchange automatically gives you an invitation to fill out the most popular bureaucratic form in town: Form 1040. This means that you must file your return, even if your income is below the filing requirement and regardless of whether you have any other filing requirements.

The wealth of information on Form 1095-A helps the recipient comply with the healthcare insurance reporting requirements. Those who receive their health insurance through the marketplace may be eligible to receive financial help in paying the health insurance premiums. The financial assistance can be in the form of a subsidy from the government (which reduces the amount you pay for insurance each month), or you may choose to pay the full insurance premium and receive a refundable tax credit when filing your taxes for the year.

Form 1095-A lists the persons in your household who received healthcare through the exchange and the months each recipient was covered. The form also contains the information needed to fill out Form 8962, Premium Tax Credit or PTC. Form 8962 calculates two important amounts. If you received financial assistance to pay for monthly medical insurance premiums through the exchange, this form will reconcile the amount of assistance you received with the amount you should have received, determined by your actual income for the year. If you should have received a larger subsidy, then you will receive a refund for the difference between what you should have received and what was actually received. If the amount of assistance received was too much, then this form will calculate the amount you will need to pay back. If you decided to pay the full premium but were eligible for a subsidy, this form will also calculate the amount you should have received, and will include that amount in your refund for the year (or reduce any amount you owe on your regular income taxes). The IRS website has an informative section on their website devoted to the healthcare filing requirements here.

The important thing to remember is that, if you received insurance through the federal or state health insurance exchange, you have to prepare this form and file annually. If you don’t, the IRS will send you a notice asking you to do so. And that may leave you tied up in more knots than the pigeon pose!


Tags: 1095-A



Jean Lee Scherkey, EA
Learning Content Developer


Jean Lee Scherkey began her career at TaxAudit in 2015, and her current title is Learning Content Developer. She became an Enrolled Agent in 2005. For several years, Jean owned a successful tax practice that specialized in individual, California and trust taxation, and assisting those impacted by tax identity theft. With over fifteen years of varied experience in the field of taxation, Jean has worked at different private tax firms as a Staff Practitioner, Tax Analyst, and Researcher. Before coming to TaxAudit, she worked over two years for TurboTax as an “Ask the Tax Expert.” In addition to her work in TaxAudit’s Learning and Development Department, Jean is actively involved in the company’s ENGAGE Volunteer Program, which provides opportunities for employees to help and serve the local community.  


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