Obamacare Tax Reporting

Healthcare Coverage & the "Individual Mandate"

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As part of the “Patient Protection & Affordable Care Act of 2010”, individuals are required to obtain and maintain health insurance or be forced to pay a penalty (in the form of tax) on their annual tax return.  According to the Obamacare website, this requirement is unofficially referred to as the “Individual Mandate”.

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The individual mandate took effect in 2014 (i.e., reportable on 2014 individual tax returns), and health insurance issuers/carriers are now required to provide certain information to policyholders via IRS Form 1095.  Below is a description of the three (3) variations of this form used to report this information.

  1. IRS Form 1095-A, Health Insurance Marketplace Statement – used to report information about individuals who enroll in qualified health plans through the “Health Insurance Marketplace”.  It is also used to allow individuals to take the premium tax credit, to reconcile the credit on their tax returns with advance payments of the premium tax credit, and to file an accurate tax return.

  2. IRS Form 1095-B, Health Coverage – used to report information about individuals who are covered by minimum essential coverage and therefore are not liable for individual shared responsibility payment (i.e., tax) on their tax returns.

  3. IRS Form 1095-C, Employer-Provided Health Insurance Offer & Coverage – used to report information about each employee of a business with 50 or more full-time employees about offers of health coverage and enrollment in health coverage for their employees.

Related Article:  Really Simplified Guide to Small Business Obamacare Rules by Stephen L. Nelson, CPA

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