Posted on 02/24/2016 12:38:16 PM PST by Red Badger
Okay, I've posted very few vanities during my time on FR, but this I believe is important for all FReepers and their relatives, who may be in the same situation.
I signed up for health insurance as required under The Affordable Care Act, using the Healthcare.gov website in November of 2014. Up until that time, my employer provided my family health insurance at no cost to me, but because of the new law was unable to continue doing so for financial reasons.
At that time, the Healthcare.gov website, after having entered my base salary numbers and my wife as sole dependent, informed me that I was eligible for a $1002 Per Month Advance Premium Tax Credit (APTC) as the 'subsidy' is called officially.
My part of the premium to my insurance company, Blue Cross/Blue Shield, was $532 per month.
The year 2015 was a good one for my employer, and I worked a lot of overtime, evenings, Saturdays and even Sundays sometimes. Then, at the end of the year I received a large bonus for all my efforts and good work.
Now, 2016 rolls around and I get my W-2 and received my form 1095-A from the Healthcare Marketplace stating all the money paid by the government to my insurance company and what premiums were paid in total.
I have no investments, other than my 401k Plan, and no rental property or any pensions or such. My wife doesn't work and my only income is from my job.
I get the IRS 1040A and start to fill it out, expecting to pay some extra taxes, since the bonus would have thrown the bi-weekly tax schedules used to determine your Income Taxes during the year a little off.
Having had health insurance all year I did not expect to have to pay any more than that.
BUT, as I continued to fill out the 1040A, and subsequently the Form 8962 that you use to report the APTC on your tax return, I was in for the biggest shock of my entire life.
Filling out the 8962 form, I discovered that I was no longer eligible for the APTC because I had made too much money during the year! According to the form, I had made more than 4X the Federal Government's Poverty Level and therefore would not be able to claim the APTC on my 1040A tax return.
Not only that, but I would read that as a result of that, NOW I WOULD HAVE TO REPAY THE ENTIRE YEAR'S APTC THAT THEY HAD GIVEN TO BC/BS in my name!
That amounts to $12,024.00! Yes, you read that right, OVER TWELVE THOUSAND DOLLARS!
Needless to say, I was, and still am in shock! My wife is hysterical. She's afraid we'll lose the house and be out in prison!
We would have been BETTER OFF NOT HAVING ANY INSURANCE AT ALL for 2015!
The 'FINE', or 'MY FAIR SHARE' as they so ridiculously refer to it in the tax instructions, would have been less than $2000.
So, if anyone asks me what I think about OBAMACARE, I will unequivocally tell them in no uncertain terms that it is the worst disaster ever created for a working man in the middle class.......................................................End of rant, and my apologies to Jim Robinson and the Mods for my vanity.............................
Nowhere that I know of is there any instruction to notify the HC MP of an changes, but for marriage, death or divorce...........
It effectively negates all the overtime and bonus for the year, so you might as well say that on those weekend days and nights I was working for the government..................
...
From the viewpoint of Big Government, Obamacare is working as intended. A big success for them!
correct - only fools supported it
How much above the line did you find yourself? Obamacare subsidies are tied to AGI so you may be able to throw enough money in a 401K or some other pre-tax investment to drop back below the subsidy line.
And yet the gov remains puzzled as to why consumers are not spending.
I understand your pain.
I’ve posted this before, but I think it bears repeating.
What is called “insurance” in the US these days has FOUR components:
1) Prepayment for routine medical care, like checkups and physicals, which of course rises in cost with age.
2) Some real, above the deductible, catastrophic coverage for unlikely but devastating illness—which is the only component that is really insurance
3) A transfer payment scheme for those who can’t afford 1) and 2),
and 4) A Pricing Club mechanism. That’s why if you go get tests or procedures without insurance, the list price is 4 to 10 times what the insurance companies actually pay. Of course, that means that if you have any assets, you get looted, which is what government is supposed to prevent, but instead encourages.
By going commando, you forego the costs of 1) and 3), and hope you don’t need 2) subject to 4).
That is, if you get really sick, you have to hope that the premiums you’ve saved are enough to get you through it at either inflated list prices, or at the prices you’ll negotiate afterwards when you’re not at your best.
What O-care did was shift some of the costs previously paid by taxpayers as a whole to the (incidentally largely white) middle class, and add multiple layers of bureaucracy, unpredictability, and inefficiency in the bargain.
I am taking some offense from your put-down. I and many HRB employees have many years of experience and training. I am an Enrolled Agent as are many others at HRB. As in EVERY enterprise you can find competent and incompetent workers. At HRB, you can sit for a full run of tax situation and a bottom line with costs and then say "No thank you" and leave.
I do agree that he needs outside help. If he wants to spend a little time, call a HRB Office and ask for an appointment with an EA or Master Tax Advisor. It only costs a commitment of time. Try a tax attorney and you are committed to a likely minimum bill of that couple of hundred bucks just for the meeting.
Too late for that. Any money that would have affected the AGI would have to have been deposited by December 31st 2015.
And the ‘eligibility’ requirement for payback of ‘excess APTC’ is a progressive scale, so that if I had stayed ‘just under’ the 4X poverty level limit, I would still have to pay back 90-95% of it. As your income rises, the more yo have to pay back. To pay back ‘$0’ I would have to be ‘in poverty’.........................
WOW! Health insurance is socialism to begin with. Hillarycare/Romneycare/Obamacare/TOTALITARIANCARE is socialism injected with steroids.
Legal Plunder - Bastiat
A YUUUUGE thanks for your post/first-hand experience.
Oh yeah, if your income goes up, your subsidy would obviously go down, and vice versa. You are supposed to make adjustments as they happen.
For example, if you applied for insurance with a $30K a year income, and 4 months into the year you got promoted to a $35K a year position, you are supposed to go to your account and update your income level.
You might also get demoted and need to adjust your income for a bigger subsidy.
If your income goes down, you would get money back.
This explains the APTC and income changes and taxes pretty well.
However, It would still really all end up basically the same, I think.
You would either have paid the extra money at the end of the year, or paid the extra money monthly as a higher premium.
Either way, you pay. They get you coming and going.................
Calling an HRB office and asking to speak with a Master Tax Advisor is excellent advice.
Walking into a temporary mall kiosk and taking what's immediately available on premise? I'd be dubious, and won't do that again.
“Changes to report
.Changes to income
.Changes in health coverage:
.Someone in your household getting an offer of job-based coverage, even if they don’t enroll in it
.Someone in your household getting coverage from a public program like Medicaid, CHIP, or Medicare
.Someone in your household losing coverage, like job-based coverage or Medicaid
.Changes to your household or individual members:
.Birth or adoption
.Placing a child for adoption or foster care
.Becoming pregnant
.Marriage or divorce
.A child on your plan turning 26
.Death
.Gaining or losing a dependent some other way
.Moving to a permanent address in your state
Note: Don’t update your application if you move out of state. See what to do when you move out of state.
.Correction to name, date of birth, or Social Security number
.Changes in status:
.Change in disability status
.Change of tax filing status
.Change of citizenship or immigration status
.Change in status as an American Indian/Alaska Native or tribal member
.Incarceration or release from incarceration”
https://www.healthcare.gov/reporting-changes/which-changes-to-report/
“You can report changes to the Health Insurance Marketplace 3 ways: Online, by phone, or in-person - not by mail.
Report changes online
Log in to your Marketplace account and follow these easy steps:
1.Select the green “Start a new application or update an existing one” button.
2.Choose your current application for 2016 under “Your existing applications.”
3.Click the “Report a life change” button from the left-hand menu.
4.Navigate through your application, and report any changes to your income, household members, new health coverage offers, and other information.
5.After you report income or household changes to the Marketplace, you’ll get new eligibility results that explain if you qualify for a Special Enrollment Period that allows you to change plans, or for changes in savings and coverage options.
.Learn more about Special Enrollment Periods.
.Learn more about changes in savings.
6.Important: Complete all required steps on your To-Do list. Depending on your eligibility, you may have options to enter your tax credit amount or answer questions about enrollment preferences. Finish the “Final review” task to complete your update or a new enrollment.
Report changes by phone
Contact the Marketplace Call Center and a representative can help you.
With in-person help
Find someone in your community who can meet with you to help make changes to your application.
What to do if you move
If you moved within the same state, you can report the change by following the instructions above.
But if you moved to a different state, you’ll need to start a new application for your new state. Moving to a new state will qualify you for a Special Enrollment Period, so you can enroll in a plan in your new area.
No matter where you move, you should also update your HealthCare.gov profile.
Steps to start a new application in a new state
.Log in to your Marketplace account.
.Select the green “Start a new application or update an existing one” button.
.Select the year and your new state from the drop-down list.
.Note: If the state you’re moving to runs its own Marketplace, you’ll use your new state’s website to apply. Otherwise you’ll apply and enroll on HealthCare.gov.
Steps to update your profile
.Log in to your Marketplace account and update the information on your Marketplace profile page. Note: Sometimes a more detailed address (like with your full ZIP code) may pop up. Select it so we’ll have your most accurate address.
.Be sure to also report address, email, and phone changes on your HealthCare.gov profile.”
https://www.healthcare.gov/reporting-changes/how-to-report-changes/
The biggest problem is ~$1,500/month premiums.
That’s over $18,000/year - far more than an operation and a week hospital stay costs in Western Europe.
I think you can deduct what you pay back pretty much. You might be only $8,000/year worse off for Obamacare.
Also see if adding to an IRA helps as another poster suggested.
Yours is the kind of story that should be receiving media focus from the previously so-called "investigative" news magazine shows like 60 Minutes, 20/20, Nightline, etc.
As we know the dino-MSM are all now simply propaganda machines for this regime and the mendacities that have been spewn out, like ObamaCare.
“if the household income for the tax year remains below 400% of the federal poverty level then the liability for excess premium payments will be limited.”
Read more at http://insuremekevin.com/irs-limits-aca-advance-premium-tax-credit-repayment/#v02huO1DQYIaue5r.99
Obama knows how to shield his base.
Wow, thanks for sharing that nightmare. I have no ideas to help (other than what another suggested perhaps you could put money into 401k?) but if it helps any (I imagine it won’t) at least some of us have learned something from you and know what to watch for.
Hopefully someone on here will have a great idea.
I should email this story to the Trump Campaign?
Or Faux news?............
I don’t know the rules of obamacare but I do know you can contribute to retirement arrangements after the 1st and still have it lower last year’s AGI. It may well be worth a visit to a tax professional (a real one, not HR block). Either way I wish you well and will pray this situation is resolved without too much hardship.
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