Problems with Form 1095-A

Reported delays and inaccuracies by state

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People who already filed their federal tax returns using incorrect 1095-A forms issued by the Centers for Medicare and Medicaid Services do not need to file an amended return to correct the mistake, the Treasury Department announced on February 24. 2015.

The problem is that the Centers for Medicare and Medicaid Services issued incorrect Forms 1095-A to 800,000 people in 37 states who enrolled in health insurance through HealthCare.gov, the federal health insurance exchange.

The mistake, according to an announcement made on February 20, 2015, is that the form shows an incorrect amount for the second lowest cost silver plan. The mistake affects "about 20 percent" of people who obtained discounted health insurance in 2014 through Healthcare.gov.

How to Tell if This Problem Affects You

  • If you purchased health insurance through Healthcare.gov, then
  • Log in to your Healthcare.gov account and look for a message that says whether or not your Form 1095-A is correct.

How This Mistake Impacts the Tax Return

The "second lowest cost silver plan" is a benchmark number. This number is an essential part of the 8-step calculation of the premium assistance tax credit, the federal subsidy for health insurance premiums. And unlike other types of figures, such as wages or interest that can be independently verified through documents that a taxpayer has in his or her possession, the second lowest cost silver plan is a figure that is known only to the insurance exchanges, as it is based on the cost health insurance available through an exchange for the family size and location of the persons being insured.

Form 1095-A is a new tax form. Designed by the IRS and issued by health insurance exchanges, the Form 1095-A reports information about a person's health insurance coverage, such as which people are insured, for what time period, the cost of the insurance, the amount of premium tax credits paid in advance, and the amount of the second lowest cost silver plan.

Information on Form 1095-A is used to complete Form 8962. This is a new tax form which taxpayers and their accountants fill out when preparing a tax return. This Form 8962 calculates the actual amount of the premium assistance tax credit that a person or family is eligible for, and reconciles advance payments against the actual amount. If a person received too much advance credits, some amount may need to be repaid. If too little credits were received in advance, there could be an additional refund owed to the taxpayer.

Thus, an incorrect Form 1095-A essentially means that taxpayers who have a Form 1095-A in their possession must first ascertain whether this tax form is accurate or not before they can file their federal tax return. The reason why is to prevent the possibility of filing a return now, only to have to amend the tax return later once a corrected Form 1095-A is issued.

Already Filed Tax Returns Do Not Have to be Amended

The Treasury Department estimates that about 50,000 people already filed their tax returns using the incorrect Form 1095-A. "We have concluded that these individuals do not need to file amended returns," the Treasury Department stated in its announcement.

Using the incorrect information, a person could have paid less tax than if they had the correct information at the time the tax return was prepared.

"The IRS will not pursue the collection of any additional taxes from these individuals based on updated information in the corrected forms," the Treasury Department further announced.

Nonetheless, it will be beneficial to go through the process of preparing an amended tax return once the corrected information is received. Here's why. It's important to figure out if the taxpayer is due an additional refund, or would have owed additional tax. If the taxpayer owes additional tax, the Treasury Department announcement is saying, basically, don't worry about the additional amount owed. The IRS won't pursue collections. If the taxpayer is due an additional refund, however, the taxpayer will benefit by filing an amended return. That's because the IRS will issue the additional refund only after an amended return is filed.

What to Do Next

"If your form was affected, you will receive a phone call from the Marketplace by early March, in addition to letters and emails with additional information about the status of your form," states the Centers for Medicare & Medicaid.

But, as Robert Longley points out, this is a recipe for disaster. Criminals increasingly have been brazen about calling and emailing people and pretending to be from the government – impersonating, for example, IRS agents demanding money. "Hopefully," Longley writes, "the actual HHS representatives will have some very trustworthy way of identifying themselves as opposed to the many identity stealing imposters who will surely try to take advantage of this situation."

Thus to prevent any possibility of being scammed by criminals, people can take the following proactive step. Log in to your account at Healthcare.gov. "You will see a notice message that will let you know if your form was or was not affected," the Centers for Medicare & Medicaid said in their announcement.

"If you have not filed, postpone filing until you get a corrected 1095A," advises Chuck Lovelace, vice president of the Affordable Care Act at Liberty Tax, who spoke to me by phone.

However, if a person absolutely needs to file sooner, they can call Healthcare.gov's marketplace call center at 1-800-318-2596 (TTY: 1-855-889-4325). There is also a tool for looking up the second lowest cost silver plan located on the Healthcare.gov Web site at https://www.healthcare.gov/taxes/tools/silver/.

Problems with 1095-A Forms by State

Alabama

Affected by the Healthcare.gov issues.

Alaska

Affected by the Healthcare.gov issues.

Arizona

Affected by the Healthcare.gov issues.

Arkansas

Affected by the Healthcare.gov issues.

California

Covered California sent out 100,000 incorrect forms; contact CoveredCA at 1-800-300-1506. See also What is Form 1095-A? on CoveredCA.com.

Colorado

No known issues. If you feel your 1095-A form is incorrect, call 1-855-752-6749. For further details, see the Tax Info page on ConnectForHealthCO.com.

Connecticut

Some forms are late. For questions call 1-888-257-1040 or visit the Tax Info page at AccessHealthCT.com.

Delaware

Affected by the Healthcare.gov issues.

District of Columbia

No known issues. For questions call 1-855-532-5465, or visit the 2014 Tax Info page at DCHealthLink.com.

Florida

Affected by the Healthcare.gov issues.

Georgia

Affected by the Healthcare.gov issues.

Hawaii

No known issues. For questions call 1-877-628-5076; TTY/TDD: 1-855-585-8604; or visit the Important Tax Information for Individuals and Families page on HawaiiHealthConnector.com.

Idaho

Affected by the Healthcare.gov issues. For details, see the Important Information about Your Federal Tax Form 1095-A page on YourHealthIdaho.org.

Illinois

No known issues. For questions call 1-800-318-2596, or visit the Marketplace Coverage & Tax Filing page on GetCoveredIllinois.gov.

Indiana

Affected by the Healthcare.gov issues.

Iowa

Affected by the Healthcare.gov issues.

Kansas

Affected by the Healthcare.gov issues.

Kentucky

No known issues. For questions or if you think your 1095-A form is incorrect, call 1-844-373-2417, or visit their Frequently Asked Questions: Taxes & the Affordable Care Act PDF file on Kynect.ky.gov.

Louisiana

Affected by the Healthcare.gov issues.

Maine

Affected by the Healthcare.gov issues.

Maryland

No known issues. For questions call 1- 855-642-8572 (TTY: 1-855-642-8573), or visit the Health Coverage and Your 2014 Taxes page on MarylandHealthConnection.gov.

Massachusetts

No known issues. For questions call 1-877-623-6765 (TTY: 1-877-623-7773), or visit the Health Coverage and Tax Filing Information for Massachusetts Residents page on MAHealthConnector.org.

Michigan

Affected by the Healthcare.gov issues.

Minnesota

About 35,000 1095-A forms are late, due to MNsure double checking the accuracy of the forms before mailing them out. For questions call 1-855-366-7873, or visit the IRS Form 1095-A page or the Frequently Asked Questions about Form 1095-A page both of which are located on MNsure.org.

Mississippi

Affected by the Healthcare.gov issues.

Missouri

Affected by the Healthcare.gov issues.

Montana

Affected by the Healthcare.gov issues.

Nebraska

Affected by the Healthcare.gov issues.

Nevada

Affected by the Healthcare.gov issues.

New Hampshire

Affected by the Healthcare.gov issues.

New Jersey

Affected by the Healthcare.gov issues.

New Mexico

Affected by the Healthcare.gov issues. See New Mexicans Urged to Verify Accuracy of 1095-A Tax Forms Before Filing 2014 Taxes on BeWellNM.com.

New York

No known issues. For questions call the NY State of Health at 1-855-766-7860, or visit the Premium Tax Credits & Form 1095-A page on NYStateofHealth.ny.gov. Also: Frequently Asked Questions about Form 1095-A (PDF).

North Carolina

Affected by the Healthcare.gov issues.

North Dakota

Affected by the Healthcare.gov issues.

Ohio

Affected by the Healthcare.gov issues.

Oklahoma

Affected by the Healthcare.gov issues.

Oregon

No known issues. For questions call Cover Oregon at 1-855-268-3767 or visit the Frequently Asked Questions page on CoverOregon.com.

Pennsylvania

Affected by the Healthcare.gov issues.

Rhode Island

HealthSourceRI delayed sending 3,381 Forms 1095-A "due to possible calculation errors." For questions call 1-855-408-1344. Also: Consumer "Frequently Asked Questions" for the 2014 Tax Season (PDF) on HealthSourceRI.com.

South Carolina

Affected by the Healthcare.gov issues.

South Dakota

Affected by the Healthcare.gov issues.

Tennessee

Affected by the Healthcare.gov issues.

Texas

Affected by the Healthcare.gov issues.

Utah

Affected by the Healthcare.gov issues.

Vermont

No known issues. For questions call 1-855-899-9600, or visit the Filing Taxes page on HealthConnect.Vermont.gov.

Virginia

Affected by the Healthcare.gov issues.

Washington

Washington Health Benefit Exchange delayed sending 5,000 Forms 1095-A due to "problems with the information," and some forms may be inaccurate, reports the Seattle Times. For questions call 1-855-923-4633, or use the online correction request form. Also: Your 1095-A Statement on the Washington Health Benefit Exchange site.

West Virginia

Affected by the Healthcare.gov issues.

Wisconsin

Affected by the Healthcare.gov issues.

Wyoming

Affected by the Healthcare.gov issues.