Q: What are the tax forms associated with health insurance, and where do I get them?
A: There are three different forms that are used by exchanges, employers, and health insurance companies, to report health insurance coverage to the IRS. And there are two health insurance-related forms that some tax filers need to complete when they file their return.
If you have specific questions about your situation, consult a tax advisor or the Volunteer Income Tax Assistance Program. Here’s an overview of the new forms that Americans have been receiving since early 2015:
Your 1095 form
Form 1095-A is sent out by the health insurance exchanges (HealthCare.gov or a state-based exchange, depending on the state). This form is mailed to the IRS and to the policyholder. It includes information about the cost of your plan, the cost of the second-lowest-cost Silver plan (benchmark plan) in your area, any premium subsidy that was paid on your behalf during the year, the months you had coverage, and which household members had coverage under the plan. Form 1095-A is your proof that you had health insurance coverage during the year, and it’s also used to reconcile your premium subsidy on your tax return, using Form 8962 (details below).
Form 1095-A is essential for preparing your tax return if you received a premium subsidy or if you paid full price for coverage through the exchange and want to claim the premium subsidy on your tax return. If you got your coverage through the exchange, don’t file your tax return until you receive your Form 1095-A. Your 1095-A will be available online in January, and the exchange should also mail it to you by early-mid February. If yours is delayed or the information on it is incorrect, contact the exchange. HealthCare.gov has a page about how to locate your 1095-A online, and state-run exchanges will also have a tab or link for tax information, 1095-A information, or something similar.
- Form 1095-B is sent out by health insurance carriers, government-sponsored plans such as Medicare, Medicaid, and CHIP, and self-insured employers who aren’t required to send out Form 1095-C instead. This form is mailed to the IRS and to the insured member. If you buy your own coverage outside the exchange, you’ll receive Form 1095-B instead of Form 1095-A. Form 1095-B essentially just shows who was covered, and which months of the year they had coverage. Premium subsidies aren’t available for plans that send a 1095-B. But if you were uninsured for part of the year, a penalty may be assessed when you file your taxes, and the details on Form 1095-B will be used to show which months you did have coverage.
- Form 1095-C is sent out by large employers who are required to offer health insurance coverage as a provision of the ACA. This applies to employers with 50 or more full-time equivalent employees. Form 1095-C is sent to the IRS and to the employees. It’s provided to all employees who were eligible to enroll in the employer’s plan, regardless of whether the employee actually enrolled in the plan or not.
Most people will only receive one of those three forms. But there are some circumstances where you might receive more than one.
For example, if you work for a large company and have access to coverage from your employer, but you opted to buy coverage in the exchange instead, you’d receive Forms 1095-A and 1095-C (the 1095-C would indicate that you were offered employer-sponsored coverage, even though you declined it). And if you switched from an individual plan to a plan offered by a large employer mid-year, you’ll end up with a form from each of them. Whatever forms you receive are also received by the IRS, so everyone is on the same page.
Forms 1095-A, B, and C may be delivered electronically or on paper, depending on whether you opted in for electronic delivery. You’ll use the information on the form to complete your tax return, but you keep it with your records (don’t attach it to your tax return.)
When will the form arrive?
For 2016 coverage and beyond, the deadline for exchanges, health insurers, and employers to send out the forms is January 31 of the following year. But for 2016 coverage, the IRS granted an extension for employers and insurers to distribute Forms 1095-B and 1095-C, and the same extension was granted for those forms for 2017 coverage. IRS Notice 2018-06 gives insurers and employers until March 2, 2018, to distribute Forms 1095-B and 1095-C to plan members.
Forms 1095-A (from the exchanges) still have to be sent to enrollees by January 31, 2018 (they may take a while to arrive, however, so it could be February before you receive yours; as noted above, you can log into your exchange account online and see your 1095-A by the end of January).
So depending on where you got your health insurance in 2017, your form may arrive in January, or it may not come until February or very early March. If you don’t get your form in a timely manner, you can contact the exchange, your health insurance carrier, or your employer, depending on who should be sending you a form.
Forms 8962 and 8965
Most Americans are able to simply check the box for “full-year coverage” on their tax return and carry on (line 61 on Form 1040). But if you received a premium subsidy from the exchange – or if you paid full price through the exchange but are eligible to claim the subsidy on your tax return – you’ll need to complete Form 8962 with your tax return.
If you received a subsidy and fail to complete Form 8962, you won’t be able to continue receiving a subsidy going forward, so this form is essential for the millions of people who are receiving premium subsidies in the exchange. The information on Form 1095-A is used to complete Form 8962.
If you did not have health insurance coverage for the full year and you’re eligible for an exemption from the requirement to maintain coverage, you’ll use Form 8965 to claim the exemption (which you get either from the exchange or from the IRS, depending on the exemption).
If you did not have coverage for the full year and you’re not eligible for an exemption, the instructions for Form 8965 have worksheets that you can use to calculate the amount of the penalty you owe.