SPECIAL AFFORDABLE CARE ACT EDITION: 
IS YOUR VITA SITE PREPARED FOR TAX SEASON? 

The Affordable Care Act brought health insurance coverage to millions of Americans this past year and Community Action was critical in reaching many hard to reach communities. 

 

Our work continues as we implement the VITA program during this year's tax season.

 

Many Voluntary Income Tax Assistance Program (VITA) participants may be impacted this year by the Affordable Care Act (ACA) and the tax filing process.  Private tax firms are trained on the new ACA tax forms and are actively reaching out to clients.  We know many of you have been working for months to prepare for tax season and want to make sure Community Action VITA sites stand ready with the most recent information to assist customers with free tax preparation options while managing changing filing requirements.

 

This special edition of the Enews features detailed information concerning the new tax filing requirement created by the ACA and provides information on a free webinar for Community Action  being hosted next week, January 20th at 1:00 ET/12:00 CT/11:00 MT/10:00 PT.

 

 

Please note, this eNews is not meant to be a comprehensive list of materials or information needed to operate a VITA site or file tax returns, but is meant to bring several issues to your attention, encourage you to learn more, and to make you aware of the upcoming training webinar. 
THE CENTERS FOR MEDICAID AND MEDICARE SERVICES TO PRESENT A WEBINAR IN COORDINATION WITH COMMUNITY ACTION PARTNERSHIP

Stefanie Costello, Insurance Specialist with Centers for Medicare and Medicaid Services will be presenting a webinar specific for Community Action on key issues concerning tax return submission for those who have purchased insurance through the Marketplace on January 20, 2014 at 1:00 p.m. ET/12:00 CT/11:00 MT/10:00 PT. 

Ms. Costello has worked closely with VITA programs and is very familiar with the work of Community Action, allowing her to put key concepts in a context that is easily accessible to Community Action Agencies.  

Subjects to be covered will include form 1095-A, the premium tax credit and the federal tax return, and resources for tax preparers among many others.   

To register for the webinar click here. 

  
AS TAX SEASON NEARS, VITA PROGRAMS SHOULD PREPARE FOR NEW ACA TAX REQUIREMENTS 

As tax season approaches, tax preparers of all sorts should be ready for how the Affordable Care Act (ACA) will impact taxes for recipients of health care purchased through the Federally and State Facilitated Marketplaces.  This is especially important for sites that implement the VITA program as it expected that a majority of the people that utilize the VITA program will have utilized one of the various tax credit options designed to make health care more accessible and affordable.  

 

For those who purchased health insurance through the Marketplace, they will receive Form 1095-A. 

 

Tax preparers should be ready to assist customers in submitting the 1095-A tax form and this will be addressed in the webinar.  This form will be delivered by mail, post marked no later than February 2, 2014, and can be accessed online through a user account on healthcare.gov.   CAAs may want to consider having internet access to allow customers at the VITA site to access their accounts on site.  Note that recipients of employer-provided health insurance or health coverage through Medicaid, Medicare, or the Children's Health Insurance Program (CHIP) will not receive this form.

 

 

 

Form 1095-A includes:

* Information about anyone in a household who enrolled in a health plan through the Marketplace    

for 2014.  

* Information about the monthly premiums paid to one's health plan.

* Information about a "benchmark" premium used to compute one's premium tax credit.

* The amount of any advance payments of the premium tax credit that were paid to one's health plan for 2014 - these payments might have helped lower what the monthly premiums.  

 

Form 1095-A will be discussed on the webinar and more information can be found here.
FINAL PREMIUM TAX CREDIT TO BE COMPUTED WITH FEDERAL INCOME TAX RETURN
Details will be critical and the webinar will provide more information. 
 
It is important to note that the final premium tax credit for 2014 will be computed with the federal income tax return. 
 
When purchasers applied for health coverage through the Marketplace, they provided information on their application about income and family size.  The Marketplace used this and other information to determine the amount of premium tax credit a purchaser was eligible to get. If they were like most people who qualified, they probably used "advance payments" of this premium tax credit at the time of enrollment in a health plan, to lower what they paid for monthly premiums. If so, the final or actual amount of the premium tax credit will be computed when they file a federal income tax return. 
 
The tax software or preparer will figure out this amount, or they will complete and attach the Premium Tax Credit Form (Form 8962) to the tax return at the time of filing.  This will impact the refund or payment our customers will experience. 
 
Learn about this important element on the webinar and by clicking here.
TAX FORM 8965 FOR THOSE WITHOUT HEALTH COVERAGE FOR PART OF 2014


 

If purchasers didn't have health coverage for part of 2014, tax preparers will assist filers to use Form 8965. If their Marketplace coverage started partway through 2014 and they were uninsured earlier in the year, they will need to fill out Form 8965 from the IRS when they file their taxes. This will establish if they qualify for an exemption from paying a fee for the months they didn't have coverage.


 

This form will be discussed on the webinar and more information can be found here.
RESOURCES
 from The Centers for Medicaid and Medicare Services

 

The Centers for Medicaid and Medicare Services has developed an array of resources to be used in ACA enrollment and tax preparation.  The following links represent selected resources, but an extended list of resources can be found here.

Additional materials may be found at
www.healthcare.gov/taxes and www.marketplace.cms.gov

 

For more information about how your Marketplace coverage will affect taxes, visit HealthCare.gov/taxes/ 

or call the Marketplace Call Center at 

1-800-318-2596.

TTY users should call 

1-855-889-4325.

 

Many people who signed up for Marketplace coverage can get free assistance with filling out their taxes. This may include free access to tax software programs, or free in-person assistance. For more information, visit IRS.gov/freefile or IRS.gov/VITA.

 

If you have questions about your taxes, need Form 8962 or Form 8965, or want to learn more about the fee for not having health coverage, visit IRS.gov.

Community Action Partnership

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Washington, DC 20036

www.communityactionpartnership.com

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