Health Care What is a Health Care Subsidy? Read the Article Open Share Drawer Share this:Click to share on Facebook (Opens in new window)Click to share on Twitter (Opens in new window)Click to share on LinkedIn (Opens in new window)Click to share on Pinterest (Opens in new window)Click to print (Opens in new window) Written by TurboTaxBlogTeam Published Jun 24, 2013 - [Updated Sep 6, 2017] 1 min read Under the new health care law, otherwise known as Obamacare, most Americans will be required to have health insurance starting in 2014. So what does that mean to you? If you already have health insurance through your employer, not much will change. But what if you don’t have insurance? To help pay for the cost of health insurance, you may be eligible for financial assistance from the government, called a subsidy. What is a subsidy? A health care subsidy is financial assistance from the government that you could be eligible for to help you pay for health insurance. Your eligibility is generally determined by your household income and family size. To see if you’re eligible for a subsidy, check out this health care calculator. Quick Tip: Even though the IRS will report your income to exchanges for you, if you used TurboTax to prepare your taxes, you can look up your 2012 income on your tax return by logging into My TurboTax or looking at your saved PDF file. How to apply for your subsidy? You can apply for your subsidy when you purchase health insurance through online federal or state health care marketplaces. The name of the online health care marketplaces are different in each state. To look up the name of the Marketplace in your state, click here. How does the subsidy work? The subsidy will go directly to your health insurance provider when you purchase insurance to lower your monthly health insurance payments or premiums. Have specific questions about how this impacts you? Ask them below or get health care reform answers in our TurboTax community. Previous Post Tips to Help You Estimate Flexible Spending Arrangement Contributions Next Post Facts About Health Care Reform Written by TurboTaxBlogTeam More from TurboTaxBlogTeam 58 responses to “What is a Health Care Subsidy?” « Older Comments i am 63 single and only get social security of 1195 a month , showing a 13930 net benefit for 2018 I get insurance thru healthmarket place paying 24.00 a month -based on annual total credit of 11208.00,, when I calculate thru turbo tax, turbox tax shows I owe the irs $4.00 . could this be correct I do not get any refund??? thanks for letting me know… Reply The people telling you the subsidy is free, and if you don’t use it you get it as a refund are WRONG. This is a fact they are not telling people and it is hurting the very people it is suppose to be helping. The truth is what ever you take in subsidy you have to claim as additional income when you file your taxes, and you will pay taxes on it. It happened to me and other people I know. It will take it out of your refund if you have one, if not you will have to pay, what you owe. Figure what they paid for you, and you will have to pay at least 10% of that back if not more. It is a crime that no where does it tell you that on the website. This same thing happened in Florida after the Hurricanes in 2004, the government offered help to pay for repairs, a subsidy, what they didn’t tell people was you had to pay it back when you filed a tax return. Reply Hi Lorrie, If you estimate your income lower than you actually make when you go to get your subsidy, then you may owe, but many taxpayers saw an additional premium tax credit because their actual income was lower than their estimated. The best way to prevent that is to try and take half of your advanced premium tax credit up front. Also, make sure report changes in income and family size to the Marketplace so they can recalculate your advance premium tax credit. These are tips that appear in many of our health care posts. Thank you, Lisa Greene-Lewis Reply Wondering….can I get BOTH a healthcare subsidy AND the Earned Income Credit? Are either of them lower because I also get the other? I earn about $20k a year and rely on the EIC. I’m right at the Medicaid threshold and trying to make sense of this. Reply Being self-employed, had a $247 a month plan, and I was eligible for a monthly Advance Payment of Premium Tax Credit of almost $200 a month. I elected not to take any, figuring I’d get it back at the end of the year if all of my numbers were correct. I too got goose eggs on Column B for my 1095-A, so I called the Marketplace and was given an SLCSP of $246 to put on each month for Column B that I was enrolled. But I still had $0 for column C. It wasn’t giving me the advance payment tax credit back….at least until I put $1 in each of those columns. Then it gave me it back in spades. From the looks of it, there’s a bug when you didn’t get any subsidy and there are $0’s for Column C. That’s the only thing I can figure, as the numbers are good on examples where I took a monthly $100 Advance Credit Payments. Reply As a followup, it shows that I qualify for $2723 tax credit advance. With me taking $0 throughout the year, I should be receiving that as a refund. I put $1 on one line in column B and it said my refund would increase by $2722. Anything that is listed in column B should be deducted from what you qualify for, but with $0, it just says you don’t get anything back. I’m kind of upset since I paid for the Business version of Turbotax. Reply « Older Comments Leave a ReplyCancel reply Browse Related Articles Health Care TurboTax 2016 Health Care Subsidy Calculator Health Care How Income and Family Size Changes Impact Your Health Insurance Marketplace Subsidy and Taxes Health Care Health Insurance Marketplace Opens Today! Health Care Same-Sex Couples and The Affordable Care Act: What Do I Need to Know? Health Care Health Insurance Marketplace Open Enrollment is Ending – Here’s What You Need to Know Health Care Affordable Care Act: Top 5 Questions Answered Health Care Demystifying the Affordable Care Act Health Care What is Obamacare? Health Care Why Shop in the Health Insurance Marketplace? Health Care Affordable Care Act Update: Millions of Americans Can Continue to Get Subsidies Through the Health Insurance Marketplace
i am 63 single and only get social security of 1195 a month , showing a 13930 net benefit for 2018 I get insurance thru healthmarket place paying 24.00 a month -based on annual total credit of 11208.00,, when I calculate thru turbo tax, turbox tax shows I owe the irs $4.00 . could this be correct I do not get any refund??? thanks for letting me know… Reply
The people telling you the subsidy is free, and if you don’t use it you get it as a refund are WRONG. This is a fact they are not telling people and it is hurting the very people it is suppose to be helping. The truth is what ever you take in subsidy you have to claim as additional income when you file your taxes, and you will pay taxes on it. It happened to me and other people I know. It will take it out of your refund if you have one, if not you will have to pay, what you owe. Figure what they paid for you, and you will have to pay at least 10% of that back if not more. It is a crime that no where does it tell you that on the website. This same thing happened in Florida after the Hurricanes in 2004, the government offered help to pay for repairs, a subsidy, what they didn’t tell people was you had to pay it back when you filed a tax return. Reply
Hi Lorrie, If you estimate your income lower than you actually make when you go to get your subsidy, then you may owe, but many taxpayers saw an additional premium tax credit because their actual income was lower than their estimated. The best way to prevent that is to try and take half of your advanced premium tax credit up front. Also, make sure report changes in income and family size to the Marketplace so they can recalculate your advance premium tax credit. These are tips that appear in many of our health care posts. Thank you, Lisa Greene-Lewis Reply
Wondering….can I get BOTH a healthcare subsidy AND the Earned Income Credit? Are either of them lower because I also get the other? I earn about $20k a year and rely on the EIC. I’m right at the Medicaid threshold and trying to make sense of this. Reply
Being self-employed, had a $247 a month plan, and I was eligible for a monthly Advance Payment of Premium Tax Credit of almost $200 a month. I elected not to take any, figuring I’d get it back at the end of the year if all of my numbers were correct. I too got goose eggs on Column B for my 1095-A, so I called the Marketplace and was given an SLCSP of $246 to put on each month for Column B that I was enrolled. But I still had $0 for column C. It wasn’t giving me the advance payment tax credit back….at least until I put $1 in each of those columns. Then it gave me it back in spades. From the looks of it, there’s a bug when you didn’t get any subsidy and there are $0’s for Column C. That’s the only thing I can figure, as the numbers are good on examples where I took a monthly $100 Advance Credit Payments. Reply
As a followup, it shows that I qualify for $2723 tax credit advance. With me taking $0 throughout the year, I should be receiving that as a refund. I put $1 on one line in column B and it said my refund would increase by $2722. Anything that is listed in column B should be deducted from what you qualify for, but with $0, it just says you don’t get anything back. I’m kind of upset since I paid for the Business version of Turbotax. Reply