IRS Expanding Relief for Incorrect Form 1095-A

Post Date: 3/27/15
Last Updated: 3/30/15


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Taxpayers who enrolled in the Health Insurance Marketplace for 2014 coverage may have received advanced payments of the Premium Tax Credit to help pay for health insurance coverage. Taxpayers who received this advanced payment should have received Form 1095-A from the Marketplace reporting the premium amount for the second lowest cost Silver plan for the area in which the taxpayer lived. This amount is needed to calculate the Premium Tax Credit the taxpayer is eligible to receive. In February, the Centers for Medicare and Medicaid Services (CMS) notified the public that 800,000 taxpayers were issued an incorrect amount for the second lowest cost Silver plan amount and that a corrected Form 1095-A was being sent to affected taxpayers. At that time, the IRS announced that if a taxpayer filed his or her tax return with information from the incorrect Form 1095-A, the taxpayer was not required to file an amended return with the IRS and that the IRS would not pursue collection of any additional taxes based on updated information in the corrected forms.

On March 20, 2015, the IRS announced that it is expanding the relief it announced on February 24. The IRS will not pursue the collection of any additional taxes from taxpayers based on updated information in the corrected forms. This relief applies to tax filers who enrolled through the federally-facilitated marketplace or a state-based marketplace. Prior relief implied that it only applied to taxpayers who purchased insurance through the federally-facilitated marketplace. This new relief applies regardless of whether the insurance was purchased through the Federal Marketplace or a State Marketplace.

Taxpayers may still want to amend their tax returns if it is determined that their premium tax credit is higher using the corrected Form 1095-A.
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