- Both you and the IRS will get a tax form showing whether you had health coverage during the previous year.
- Health insurance exchanges track enrollees and report the information to the IRS.
- There is no longer a penalty for being uninsured in most states, but the IRS will continue to receive enrollment and coverage offer reports from exchanges and employers.
A. Regardless of where you get your health insurance, you (and the IRS) will receive a tax form from your employer, insurance company, or exchange each year showing that you had coverage during the previous year. The information on these forms is used to complete your tax return and – if applicable – reconcile your premium subsidy on your return.
The health insurance exchanges keep track of who gets exchange-based coverage, and report that information to the IRS. But health insurers and employers also report information to the IRS, for people who get their coverage elsewhere. This information is used by the IRS to ensure that large employers are complying with the employer mandate, and that premium subsidies in the exchange aren’t provided to people who have access to employer-sponsored coverage.
Starting with 2019 tax returns (filed in early 2020), tax filers will no longer face a penalty if they were uninsured during the year, but Forms 1095-A and C will still be distributed to exchange enrollees and employees, and Form 8962 will still be used to reconcile premium subsidies, as the subsidies continue to be available. [Form 1095-B is used by insurers and small businesses to report health coverage that they provided during the year. This may not continue to be necessary without an individual mandate penalty, but the IRS clarified that Form 1095-B still had to be issued for 2019, with a deadline of March 2, 2020.]
Although there is no longer a penalty (in most states) for being uninsured, health insurance reporting to the IRS is mostly unchanged. Employers still have to report coverage offers to the IRS and employees, as subsidy eligibility is based in part on whether the person has access to an employer-sponsored plan. And exchanges still have to provide the information that individuals and the IRS need in order to reconcile subsidy amounts.