Thousands Who Didn’t File Tax Returns May Lose Health Care Subsidies

[eridani]

If you know anyone to whome this might apply, please give them a heads-up

http://www.nytimes.com/2015/10/26/us/politics/thousands-who-didnt-file-tax-returns-may-lose-health-care-subsidies.html

IRS Form 8062 - Premium Tax Credit
https://www.irs.gov/pub/irs-pdf/f8962.pdf

IRS Instructions for Form 8962 (15 pages)
https://www.irs.gov/pub/irs-pdf/i8962.pdf

Tens of thousands of people with modest incomes are at risk of losing health insurance subsidies in January because they did not file income tax returns, federal officials and consumer advocates say.

Under federal rules, anyone who receives an insurance subsidy must file a tax return to verify that the person was eligible and received the proper amount of financial assistance based on household income.

When the federal insurance marketplace opens for the third enrollment season next Sunday, users will see a new question: “Did your household file a 2014 tax return and reconcile any premium tax credit you used?”

If the answer to that question is no, consumers risk losing the subsidies they receive to help pay premiums. Without such assistance, many would find insurance unaffordable.

Comment by Don McCanneof PNHP: This is just one more small but somewhat shocking example of the unnecessary administrative complexity created by the Affordable Care Act (ACA).

Based on income alone, many people are not required to file tax returns if their income falls below a certain threshold (amount varies based on taxpayer status). However, many of these low-income individuals purchase plans through the ACA insurance exchanges and qualify for premium tax credits. All individuals who receive these credits under ACA must submit Form 8962 for the premium tax credit. It must be attached to an income tax return (Form 1040, 1040A, or 1040NR), so these people are required to submit tax returns no matter how low their incomes.

The penalty for not submitting Form 8962 attached to an income tax return is the requirement to refund any premium tax credits received and a disqualification from receiving tax credits in the following year. That’s quite a penalty for people with low incomes when you consider that ACA was supposed to make health care affordable. After all, “Affordable” is in its name.

But look at Form 8962 (click on link above). Then glance through the 15 pages of instructions for filling out Form 8962 (link also above). Sophisticated taxpayers are likely to find this daunting, but think of what it would be like for many of the low-income individuals who would have difficulties with just the simplified Form 1040A tax return, not to mention this monstrosity. It makes you think that ACA means “Administrative Complexity for All.”

Since there are no premiums in a well-designed single payer system, there would be no need for premium tax credits. The entire health care system would be funded by simplified taxes based on ability to pay. The health care system would always be there for you whenever you needed it, regardless of your tax situation. Even if delinquent, the IRS could not penalize or take away your health benefits.

[unblock]

1. you can still file late, can't you?

point taken as to the administrative burden, but you can still file late, right?

i don't think there's even a penalty for filing late provided you didn't actually owe any money. i think the penalty for late filing only applies if you owe money.

[dixiegrrrrl]

2. A blue print of how single payer medical care was derailed.

Instead a system was created that benefits insurance companies who can, and have, raised premiums,
and one which traps people in senseless gov. red tape.

[nationalize the fed]

3. +1 Keith Olbermann didn't like it

He said this and soon he was fired

Hope Max Baucus (the Democrat that had single payer doctors and nurses arrested at a hearing) is doing a good job as Ambassador to China

Baucus's Raucous Caucus
http://www.democracynow.org/2009/5/13/baucus_raucus_caucus_doctors_nurses_and

Too bad Obama didn't keep his promise regarding a Public Insurance option. But he knew most people would forget that flip-flop in a matter of days...

Harry Reid knew that most people would forget too...

[Vinca]

4. Exactly right.

If we had gotten the public option, people would have gravitated to it and we might have single-payer by now.

[eridani]

5. Please inform anyone you know who might not otherwise file a tax return.

Really important!!