U.S. Immigrants Attention! As the New Year arrives, the United States has entered its annual "tax season." Under the Affordable Care Act (ACA), individuals who do not provide proof of health insurance coverage when filing their 2016 tax returns will be fined $325. For families, the fine is three times the individual amount regardless of the number of members, totaling $975. Therefore, tax filing this year should be handled with greater caution. Immigrant friends need to understand the required health insurance tax forms in advance to avoid being fined unnecessarily.
CBS News reported on the 4th that the ACA requires employers and health insurance companies to provide the Internal Revenue Service (IRS) with information regarding the income and health insurance coverage of the insured. To facilitate tax filing for the public, the IRS has designed the 1095 series forms—1095-A, 1095-B, and 1095-C—in addition to the 8962 and 8965 forms used for tax credits and exemptions, depending on the type of health insurance chosen.
8962 Form: Premium Tax Credit
Form 8962 (Premium Tax Credit, or PTC) is the form for the health insurance premium tax credit and is an attachment to the 1040, 1040A, or 1040NR income tax returns. The data to be entered includes family members, annual gross income, federal poverty level, and total insurance premiums paid throughout the year.
8965 Form: Health Coverage Exemptions
Form 8965 (Health Coverage Exemptions) is the form to be used for claiming health insurance exemptions. The data to be entered includes the exemption certificate number provided by the Health Insurance Marketplace or Exchange, the category of exemption, and the record of family members' exemption status for each month of the previous year.
1095-A Form: Health Insurance Marketplace Statement
If U.S. residents purchase health insurance through the government's Health Insurance Marketplace or Exchange, they must submit Form 1095-A when filing taxes. This form is primarily used to report the monthly insurance premiums of the insured and the advance premium tax credits received each month. The records from 1095-A will be automatically linked to Form 8962.
1095-B Form: Health Coverage
Form 1095-B is used by U.S. residents to report the coverage provided by a qualifying health insurance plan, including the months covered and any dependent family members. Typically, the insurance company will provide this form proactively.
1095-C Form: Employer-Provided Health Insurance Offer and Coverage
If U.S. residents have "affordable" health insurance provided by their employer, they cannot claim the premium tax credit when filing taxes, regardless of their annual income level.
Worldway Group Friendly Reminder: For all our immigrant friends, understanding the basics of U.S. tax filing is crucial for adapting to American society and life. Due to the provisions of the ACA, tax filing this year should be handled with extra caution, and it is especially important to be clear about the required health insurance tax forms in advance to avoid being fined unnecessarily. As a leading institution in the immigration industry with 18 years of experience, Worldway Group has a comprehensive settlement and after-care service team that provides professional and attentive service down to every minor detail of our clients' immigration journey to the United States. For more details, please call: 400-138-2929
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