If your child files their own tax return and is included on a shared Marketplace health insurance policy, you may need to allocate amounts from Form 1095-A between tax returns.
This allocation is reported on Form 8962, Part IV.
Allocation Rules
General Rule
- Allocation applies when:
- A Marketplace policy covers individuals in more than one tax household, and
- Those individuals file separate tax returns
Default Allocation
- If no agreement is made, the IRS allows any reasonable allocation percentage (0% to 100%), as long as:
- Both parties use the same allocation percentages.
Common Allocation Methods
- 50% / 50% split (most common if shared equally)
- 100% / 0% split (one taxpayer claims all amounts)
- Any other agreed percentage based on:
- Who paid the premiums
- Who is claiming the dependent
What Must Be Allocated
On Form 8962, Part IV (Lines 30–33), you allocate:
- Column (e): Premiums (Form 1095-A, Column A)
- Column (f): SLCSP amounts (Column B)
- Column (g): Advance Premium Tax Credit (Column C)
Special Considerations
- If your child is claimed as your dependent, you generally report 100% of the amounts
- If your child files independently and is not your dependent, allocation is required
- If you cannot agree, each taxpayer may still choose a reasonable allocation, but inconsistencies can trigger IRS review
Source:
Form 8962 Instructions (Premium Tax Credit)
Disclaimer: Always verify details with current IRS forms, instructions, and your state’s Department of Revenue. Tax rules may vary based on individual circumstances. For complex situations, consult a CPA or tax attorney.