New Tax Documents with the Affordable Care Act

As you might have read about in January’s mailing, some of you may be receiving a new form 1095 that summarizes which individuals in your household are covered and the months during which they were covered. These forms will be important for filing your tax return this year, so make sure to include them when delivering your W-2s and other necessary documents.

Large employers who provide health insurance will issue a form 1095-C which details your employer’s lowest-cost monthly plan and the employee’s share of this plan. Employees can claim premium tax credits if their portion of the employer’s lowest cost plan is more than 9.5% of their 2014 income. It’s important to note that employers who provide health insurance are not required to issue a form 1095 for the 2014 tax year. If you do not receive a form 1095, be prepared to answer additional questions about your healthcare coverage in 2014.

Additionally, those who received subsidies in order to help cover the cost of marketplace-purchased insurance will receive a form 1095-A. The form 1095-A will note the amount in premium tax credits paid to the insurer. These credits were based on your estimated 2014 household income and family size; however, if your actual income and family size in 2014 — as calculated by form 8962— was different than the estimate, you may have to repay part of the premium tax credit or you may be eligible to receive the remainder of the credit as a tax refund.

Private insurers and insurers offered through the marketplace are required to mail a form 1095 by January 31, 2015.

Everyone at Elm3 would be happy to answer any questions you have about changes in this year’s filing process. We understand these changes may be confusing, and we are committed to making your tax filing process smooth and manageable. You can help us by recording important health coverage information and organizing the necessary documents.