We are sad to learn about the tragic events that took place in Paris last Friday. Our thoughts and prayers are with the friends in the City of Love and Lights.
Last week I met with three clients with questions on how to apply for assistance to pay the premiums for health coverage through the Health Insurance Marketplace. I am sharing with you this week the guidelines I provided to these clients.
Here are three things you should consider before you apply for this assistance:
- Advance credit payments lower premiums – You can choose to have all, some, or none of your estimated credit paid in advance directly to your insurance company on your behalf to lower what you pay out-of-pocket for your monthly premiums. These payments are called advance payments of the premium tax credit or advance credit payments. If you do not get advance credit payments, you will be responsible for paying the full monthly premium.
- A tax return may be required – If you received the benefit of advance credit payments, you must file a tax return to reconcile the amount of advance credit payments made on your behalf with the amount of your actual premium tax credit. You must file an income tax return for this purpose even if you are otherwise not required to file a return.
- Credit can be claimed at tax time – If you choose not to get advance credit payments, or get less than the full amount in advance, you can claim the full benefit of the premium tax credit that you are allowed when you file your tax return. This will increase your refund or lower the amount of tax that you would otherwise owe.
My recommendation is to provide accurate information regarding your family composition and your projected household income when you apply for this assistance.
If you need help in preparing this information to apply for this assistance, please call me at (305) 443-1068.
Have a great week!!!
Julio Jiron, CPA