Explanation of the 1095A Tax Form

Like all other insurance plans, the Affordable Care Act needs an individual to furnish all details related to his yearly income and his existing medical conditions in order to calculate the eligibility for subsidies and also to formulate the exact plan that perfectly covers all his medical needs. These details also comes in handy to determine if the individual has (at some point of time) has defaulted on his annual premiums or have some unfurnished source of income or has the right coverage according to his income. As part of this exercise, an individual may receive any of the three forms namely 1095A, 1095B or 1095C. These forms can be downloaded from the website hosted by the IRS and have to be submitted during filing for an income tax return with all mandatory details duly filled in. The 1095A form is generated for tax payers who have purchased their health insurance coverage from the insurance plans that are available on the Marketplace platform. 

In essence this form contains the details of the insurance coverage a customer has purchased (be it for individual or for family) and is a key factor in obtaining any form of tax credits available based on previous year’s medical history. Thus, it serves a dual purpose. Primarily it acts as a tax refund claim (if paid extra taxes) and also as a basis to calculate a hefty fine amount for defaulting on the due insurance coverage payments. Hence this form holds the maximum precedence as compared to the other two forms. This form is either emailed to the tax payers generally by the month of February and also hosted on the government healthcare website to allow the tax payers to raise any red flags in case of any inaccuracies or misrepresentation of the actual amounts they have paid as taxes. The 1095A form contains the amount of tax credit a tax payer is entitled to obtain (also known as the second lowest cost Silver plan) as calculated by the Income Tax Authority in regulation of the laws of the state and the income level of the tax payer. So it is highly advised that all taxpayers who receive this form should go through it thoroughly as many times error on the part of tax computing officials can cost a tax payer a good amount of money. 

Moreover it will also save on the hassles of claiming for refund at a later point of time. Also people who have availed a family health care plan should verify that all the family members have been duly accounted for under the coverage. In case of any discrepancies in the amount charged or for any queries, tax payers can always dial up the toll free number provided by the Marketplace and get the issues sorted out. Marketplace representatives are available throughout the day, so one can dial up anytime to get their doubts cleared. The easy way to determine any fault (if present) is to carefully check the contents of Column B part 3 which states the monthly premium amount paid. If this section contains a null or blank value, one should immediately ask for assistance and get it corrected. Another important point to be remembered is that this form should contain the correct details about the individual. 

Hence any and all changes pertaining to address change or marital status change or becoming a parent or death of a listed dependent should be corrected immediately by contacting the Marketplace help care number and generating an updated 1095A form. In case anyone has not received the 1095A by the end of February or not able to view the form by following the instructions to open it from the government website, one should not try to file for income tax. As this may result in the loss of any subsidies one is entitled to or can even lead to penalties. The best way is to contact the marketplace representatives and ask them to generate the 1095A form and to furnish all details that they may require in order to do so. Hence, it is of paramount importance that a correct version of 1095A should be submitted while filing for tax return.