25.19.1  General Information

25.19.1.1  (09-01-2008)
Health Coverage Tax Credit (HCTC) General Overview

  1. The Health Coverage Tax Credit (HCTC) office was established with the Trade Adjustment Assistance Reform Act (TAARA) of 2002. This program is a refundable federal tax credit that can pay for 65% of health insurance premiums for qualified individuals.

  2. The HCTC assists in paying the Health Insurance premiums for trade affected employees in partnership with the State Workforce Agencies. The HCTC also pays for health insurance premiums for Pension Benefit Guarantee Corporation (PBGC) recipients.

  3. Once you satisfy the initial TAA, ATAA or PBGC eligibility requirement, a SWA or the PBGC sends an eligibility record to the HCTC Program. The Program will then mail the taxpayer the HCTC Program Kit, which describes the tax credit and eligibility requirements in detail.

  4. The participant can enroll in the monthly credit program plan to pay their premiums each month as their premiums become due or file yearly when they file their federal tax return.

  5. Once enrolled in the monthly HCTC, the participant pays 35% of monthly health premiums to IRS. The IRS matches with the other 65%, and IRS pays 100% of the premium to file participant’s health plan.

  6. There are five areas of operations in the HCTC Program Office . They are:

    Campus Management Operations (CMO)The CMO team oversees operations for the HCTC claimed the end of the year.

    The CMO team ensures eligibility indicators are put on a taxpayer’s account, and works with Exam to identify tax returns for review in the Austin Processing Center.

    Stakeholder Engagement Operations (SEO) The SEO team is the primary contact for the Health Coverage Tax Credit office for internal stakeholders. HCTC supports our Stakeholders by educating them on program operations and requirements. SEO also answers eligibility questions and responds to high-level marketing and outreach inquires.

    Systems Operations (SO) The SO office runs and manages all systems network applications for HCTC. The two main systems are a payment processing system and a case management system. The Payment Processing system maintains financial records of all HCTC eligible participants. The system processes the participants 35% monthly premiums. The payment record report is sent to the Integrated Financial Management System (IFS) and the full payment totaling 100% is then either sent electronically or via paper to the participant's Health Plan Administrator. The Case Management system is a database application that provides participant registration and payment information to the Customer Service Representatives (CSR) and IRS personnel. The Case Management system provides health plan information and participant information for all HCTC participants. This system is maintained outside of the IRS mainframe by contractors.

    Payment Processing Office (PPO)The Payment Processing team processes and approves all payments to HCTC participants. They also balance the general HCTC ledger and work escalated payment issues.

    Customer Service Operations (CSO)The Customer Service Operations (CSO) works closely with all areas of operations for the HCTC Program. The Customer Service Representatives (CSR’s) answer calls from participants and responds to written correspondence regarding participant questions. This office also processes registrations and resolves simple account issues.


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