Affordable Care Act Tax Provisions for Individuals and Families
The Affordable Care Act, or health care law, contains new health insurance coverage and financial assistance options for individuals and families. The IRS will administer the tax provisions included in the law. Visit HealthCare.gov for more information on coverage options and financial assistance.
Considerations for 2013
- Open Enrollment for the Health Insurance Marketplace: The open enrollment period to purchase health care coverage through the new Health Insurance Marketplace began Oct. 1, 2013. When you get health insurance through the marketplace, you may be able to get advance payments of the premium tax credit that will immediately help lower your monthly premium. Learn more at HealthCare.gov.
- Filing Requirement: If you do not have a tax filing requirement, you do not need to file a 2013 federal tax return to establish future eligibility or qualify for future financial assistance, including advance payments of the premium tax credit to purchase health insurance coverage through a Health Insurance Marketplace. Learn more at HealthCare.gov.
- W-2 Reporting of Employer Coverage: Certain employers are required to report the value of the health insurance coverage they provide. The value of health care coverage as reported by your employer in box 12 and identified by Code DD on your Form W-2 is not taxable.
- Itemized Medical Expenses: You can deduct your unreimbursed medical and dental expenses that exceed 10 percent of your adjusted gross income on your 2013 tax return. The 7.5 percent threshold will remain for those 65 and older for tax years 2013 through 2016.
- Other ACA Tax Provisions: Additional Medicare Tax, Premium Rebate for Medical Loss Ratio, Health Flexible Spending Arrangements, Health Saving Accounts, and Net Investment Income Tax.
Looking ahead to 2014
- Premium Tax Credit: To claim the premium tax credit, you must get insurance through the Marketplace. You can elect to have advance payments of the tax credit sent directly to your insurer during 2014, or wait to claim the credit when you file your tax return in 2015. If you choose to have advance payments sent to your insurer, you will have to reconcile the payments on your 2014 tax return filed in 2015. Learn More.
- Individual Shared Responsibility Payment: Starting January 2014, you and your family must either have health care coverage, have an exemption from coverage, or make a payment when you file your 2014 tax return in 2015. Most people already have qualifying health care coverage and will not need to do anything more than maintain that coverage throughout 2014. Learn More.
- Change in Circumstances: If you are receiving advance payments of the premium tax credit to help pay for your insurance coverage, you should report changes such as income or family size to your marketplace. Reporting changes will help to make sure you are getting the proper amount of assistance.