Demystifying Form 1095-A: Your Guide to Health Plan Reporting

Overview of Form 1095-A and Its Purpose

Form 1095-A, also known as the Health Insurance Marketplace Statement, is issued by the Health Insurance Marketplace to individuals who enrolled in a qualified health plan through the Marketplace. Its primary purpose is to report information to the IRS about coverage and to assist taxpayers in claiming the Premium Tax Credit (PTC).

• It provides details about the health plan, including the months of coverage and the amount of advance premium tax credit (APTC) paid on behalf of the individual.
• Taxpayers use Form 1095-A to complete IRS Form 8962, which reconciles the APTC received during the year with the actual PTC they are eligible for when filing their tax return.
• The form is required for individuals who obtained coverage through the Marketplace and helps ensure accurate tax reporting and proper credit adjustments.
• It must be furnished for each policy, and only includes information relevant to the enrolled tax family (including the taxpayer, spouse, and dependents).
• Form 1095-A should not be issued for catastrophic health plans or stand-alone dental plans, as these are not eligible for the premium tax credit.

Who Needs to File Form 1095-A: Eligibility and Requirements

Form 1095-A is required to be filed by Health Insurance Marketplaces, not individuals. These marketplaces must file Form 1095-A to report information on all enrollments in qualified health plans purchased through the Marketplace in the individual market.

• Who Must File: Health Insurance Marketplaces are responsible for filing Form 1095-A for each enrollment in a qualified health plan.
• Exclusions: Do not file Form 1095-A for catastrophic health plans or stand-alone dental policies.
• Reporting Per Policy: A separate Form 1095-A must be furnished for each policy, and the information must relate only to that specific policy.
• Recipient Information: The form is furnished to each tax filer enrolled in the plan, reporting coverage only for members of that tax filer’s tax family (including the filer, spouse if filing jointly, and dependents).
• Special Circumstances: If two spouses enroll in a plan and divorce during the year, the Marketplace may provide the form to one taxpayer, but the other may need the information to complete Form 8962. In such cases, the recipient should share a copy as needed.

Key Sections of Form 1095-A: Important Parts and What They Cover

Form 1095-A is issued by the Health Insurance Marketplace to individuals who enrolled in a qualified health plan. It serves as a critical document for claiming the premium tax credit and reconciling advance credit payments on tax returns.

• Part I: Individual Information – Includes the Policyholder’s name, social Security Number (SSN),address, Policy number, Marketplace identifier, This section confirms the identity of the person enrolled in coverage.
• Part II – Covered Individuals- Includes the names of individuals covered under the policy, Months of coverage for each person, this section helps confirm who was enrolled and for which months.
• Part III – Coverage Information-This section is critical for completing Form 8962. It includes monthly amounts for: Column A - Total monthly premium for the policy, Column B - Second Lowest Cost Silver Plan (SLCSP) premium Column C - Advance payment of the Premium Tax Credit (APTC) Taxpayers use these amounts to reconcile the credit on Form 8962.

What's New for Form 1095-A: Recent Tax Law Changes and Updates for 2025

Form 1095-A, known as the Health Insurance Marketplace Statement, is used to report enrollment in qualified health plans through the Health Insurance Marketplace. For tax year 2025, the IRS requires Marketplaces to file Form 1095-A by January 31, 2026, for coverage during calendar year 2025.

• Void and Corrected Statements: If a Form 1095-A is issued in error (e.g., for a stand-alone dental plan or catastrophic health plan), a duplicate form with the VOID box checked must be sent. Similarly, if information is incorrect, a corrected form with the CORRECTED box checked must be provided promptly.
• Reporting Requirements: A separate Form 1095-A must be furnished for each policy. Only information related to that specific policy should be reported. If multiple tax filers are enrolled in one policy, each receives a statement reporting only their tax family’s coverage.
• Advance Credit Payments: Column C on Form 1095-A reports the monthly advance credit payments. If multiple forms are filed for the same family, only the portion allocated to the policy on that form should be reported.
• SSN Truncation: On statements furnished to individuals, the SSN can be truncated by showing only the last four digits and replacing the first five with asterisks or Xs. However, full SSNs must be reported when filing with the IRS.
• Exclusions: Do not file Form 1095-A for catastrophic health plans or stand-alone dental plans. These are excluded from reporting requirements.

Related Schedules and Forms for Form 1095-A

Form 1095-A is primarily used by individuals who enrolled in a qualified health plan through the Health Insurance Marketplace. It provides essential information needed to claim the premium tax credit and reconcile advance payments made during the year.

• Form 8962 (Premium Tax Credit) – This form is directly linked to Form 1095-A. Taxpayers use Form 8962 to calculate and reconcile the premium tax credit based on the data reported on Form 1095-A. This is the primary form where 1095-A data is entered.
• Form 1040 (U.S. Individual Income Tax Return) – Taxpayers must use the results from Form 8962 when filing their annual tax return to reconcile advance premium tax credits. The final credit or repayment amount calculated on Form 8962 is transferred to Form 1040 via Schedule 2 (for repayments) or Schedule 3 (for credits).

Taxpayers should ensure that all information from Form 1095-A is accurately transferred to Form 8962 to avoid discrepancies in credit calculations. While Form 8962 is the primary reconciliation form, taxpayers may also need to include Schedule 2 or Schedule 3 with their Form 1040 to report the final resulting amounts.

Important Deadlines for Form 1095-A: When to File and Penalties for Late Filing

Form 1095-A is used by Health Insurance Marketplaces to report information about individuals enrolled in qualified health plans through the Marketplace. This form helps individuals claim the premium tax credit and reconcile advance payments on their tax returns.

• Filing Deadline: The annual report must be filed with the IRS and furnished to individuals on or before January 31, 2026, for coverage in calendar year 2025.
• Furnishing to Individuals: The Form 1095-A must be properly addressed and mailed or electronically delivered (if consented) by the due date. If the due date falls on a weekend or legal holiday, it must be furnished by the next business day.
• Void or Corrected Forms: If a Form 1095-A is sent in error (e.g., for a catastrophic health plan or stand-alone dental plan), a duplicate form with the "VOID" box checked must be sent to both the IRS and recipient. Similarly, if information is incorrect, a corrected form with the "CORRECTED" box checked must be sent as soon as possible.
• Penalties for Late Filing: While specific penalty amounts are not detailed in the provided context, failure to file or furnish Form 1095-A by the deadline may result in penalties under IRS regulations. The IRS may impose penalties for failure to timely furnish required information to individuals or file with them.
• Exclusions: Do not file Form 1095-A for catastrophic health plans or stand-alone dental plans. These are excluded from reporting requirements.

Common Mistakes to Avoid on Form 1095-A

Form 1095-A is crucial for reporting health insurance coverage obtained through the Health Insurance Marketplace and for claiming the premium tax credit. Taxpayers and issuers must avoid several common errors to ensure compliance and accurate tax filing.

1. Reporting Incorrect Plans: Do not issue Form 1095-A for catastrophic health plans or stand-alone dental plans. These are excluded by IRS rules. If mistakenly issued, mark the form as VOID and notify both the IRS and recipient promptly.
2. Incorrectly Allocating Premiums: When multiple tax filers are enrolled in the same policy, each must receive a separate Form 1095-A reporting only their share of premiums and coverage. Do not combine or misallocate premiums across tax filers.
3. Improperly Reporting Advance Credit Payments: Column C should reflect only the advance credit payments allocated to the specific policy on that form. If multiple forms are issued for a family, ensure payments are split correctly and not duplicated.
4. Failing to Correct Errors: If incorrect information is reported, issue a corrected Form 1095-A by checking the CORRECTED box and send it to both the IRS and recipient as soon as possible.
5. Misidentifying Tax Family Members: Only individuals who are part of the tax filer’s tax family (including spouse and dependents) should be reported on their Form 1095-A. Others enrolled in the same policy must receive separate statements.
6. Missing Filing Deadline: Forms must be furnished to individuals by January 31, 2026, for 2025 coverage. If the deadline falls on a weekend or holiday, file by the next business day.
7. Improper SSN Truncation: On forms given to individuals, SSNs can be truncated (showing only last four digits), but full SSNs must be reported to the IRS.

Helpful Tips for Completing Form 1095-A

Form 1095-A is used to report enrollment in a qualified health plan through the Health Insurance Marketplace. It helps individuals claim the premium tax credit and reconcile advance payments with their actual tax return.

• Who Must File: Health Insurance Marketplaces must file Form 1095-A for all enrollments in qualified health plans. Do not file for catastrophic health plans or stand-alone dental plans.
• Furnishing Statements: Provide a separate Form 1095-A for each policy. Each tax filer receives a statement showing only coverage for their tax family (including spouse and dependents if filing jointly).
• Correcting Errors: If incorrect information is reported, issue a corrected Form 1095-A by checking the "CORRECTED" box and send it to both the IRS and the recipient as soon as possible.
• Voiding Statements: If a Form 1095-A was sent in error (e.g., for a dental plan), send a duplicate with the "VOID" box checked and notify both the IRS and recipient promptly.
• Timing: File the annual report with the IRS and furnish statements to individuals by January 31, 2026, for coverage in 2025. Electronic delivery is allowed if consented to by the recipient.
• SSN Truncation: On statements sent to individuals, you may show only the last four digits of the SSN (replacing first five with * or X). Truncation is not allowed on forms filed with the IRS.
• Column C - Advance Credit Payments: Enter only the advance credit payments allocated to the policy reported on this form. If multiple policies cover the same family, allocate payments correctly per policy.
• Software Assistance: Use tax software to add Form 1095-A during filing. Navigate to Federal > Payments/Refundable Credits > Premium Tax Credit > Add or Edit > Health Insurance Marketplace Statement.

Source

• For more up-to-date information visit https://www.irs.gov Government website.
• For the most accurate and detailed information regarding which schedules and forms are necessary for your specific tax situation, refer to the Instructions for Form 1095-A or consult a tax professional.

How to add Form 1095-A?

Software can guide you through How to add Form 1095A while filing your tax return using our Software. To add Form 1095A in the software, follow these steps:

1. From within your Tax return (Online), in the left menu (for mobile devices, tap the three dots in the top-right corner to see more options), click on Federal.
2. Under the Payments/Refundable Credits section, click on the Show more button near Premium Tax Credit, then click on Add or Edit next to Health Insurance Marketplace Statement - Form 1095-A.
3. Follow the on-screen instructions.