YouTube video text script- IRS Commissioner: Premium Tax Credit
Hi, I'm John Koskinen, commissioner of the Internal Revenue Service.
I'm here today to share with you important information about the Affordable Care Act.
If you're eligible, the premium tax credit can assist you in purchasing insurance, as long as you buy it through the Health Insurance Marketplace.
Well, you need to buy your insurance through the Health Insurance Marketplace.
You need to have family income that fits within the eligible range and you can't be eligible for any other program, such as Medicare, Medicaid, or employer insurance.
You can get the premium tax credit either as an advance payment when you enroll, which will be paid directly to the insurance company and lower your monthly premium, or you can apply for it in total when you file your tax return..
The advance payments of the premium tax credit are based upon your family size and estimated income.
And paid on your behalf directly to the insurance company, and it offsets your monthly insurance premium.
The first thing and probably the most important thing to know is, if your circumstances change -- either your family size or your income -- you should report that change immediately to the health insurance marketplace where you purchased your insurance, so they can make an appropriate adjustment to your premium payment so that you don't end up owing us money next year that you didn't expect.
The advance payment on the premium tax credit that you're eligible for is based on a determination of your income and your family size.
If that changes, and you would be eligible for a smaller payment, if you don't report the change, you'll then have to make that reimbursement of the payment that's been made on your behalf to the insurance company when you file your tax return.
If you have a change in your family size -- you have a birth, an adoption, if your situation changes, you have a divorce, or there's a death in the family -- if you have an increase in income – you get an increase in salary, or your lose your job -- any of those changes should be reported immediately to the Health Insurance Marketplace.
If you go to the website called HealthCare.gov, it will give you information about exactly how to advise the Health Insurance Marketplace of the change in your circumstances.
At tax time, if you're eligible for a premium tax credit -- either you have already been receiving advance payments that went to your insurance company or you're going to claim the credit for the first time -- when you file, there will be a form that you'll complete, and it will calculate what your actual premium tax credit eligibility is -- what the amount is -- depending on what you actually earned and the size of your family.
To the extent that you've already been receiving the benefit of the advance payment to your insurance company, if it turns out that payment was larger than what your final eligibility is, that amount will be then added to the tax owed on your bill or lower your refund.
To the extent you have not been receiving any advance payments, then the premium tax credit to which you're entitled will be added to your return, either in the form of an increase in your refund or a decrease in the amount of taxes owed.
For information about the premium tax credit, you can go to our website, irs.gov/aca.
For information about providing change-of-circumstance information, or other information about the act, you can go to the website HealthCare.gov.
I'd just like to remind people again that if you have a change in your circumstances -- either your family size or your income -- you should report that as quickly as you can to the Health Insurance Marketplace where you originally signed up for health care.