Demystifying Form 1095-A: A Comprehensive Guide

Overview of Form 1095-A and Its Purpose

• Form 1095-A is used to report information to the IRS about individuals who enroll in a qualified health plan through the Health Insurance Marketplace.
• It is also furnished to individuals to help them take the premium tax credit, reconcile the credit on their returns with advance payments of the premium tax credit, and file an accurate tax return.
• Marketplaces must file Form 1095-A for all enrollments in qualified health plans in the individual market through the Marketplace, excluding catastrophic health plans or stand-alone dental plans.
• The form must be filed with the IRS and furnished to individuals by January 31 of the year following the coverage year.

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

• Form 1095-A is used by Health Insurance Marketplaces to report information to the IRS about individuals who enroll in qualified health plans through the Marketplace.
• Marketplaces must file Form 1095-A for all enrollments in qualified health plans in the individual market, excluding catastrophic health plans and stand-alone dental plans.
• Each policy requires a separate Form 1095-A, and each tax filer receives a statement for their tax family, which may include themselves, their spouse, and dependents.
• The form must be furnished to individuals by January 31 of the year following the coverage year, for example, by January 31, 2025, for coverage in calendar year 2024.

Key Sections of Form 1095-A

• Purpose and Use: Form 1095-A is used to report information to the IRS about individuals who enroll in a qualified health plan through the Health Insurance Marketplace. It is also used to allow individuals to take the premium tax credit and reconcile advance payments of the premium tax credit.
• Void Statements: If a Form 1095-A is sent in error for a policy that should not be reported, such as a stand-alone dental plan, a duplicate form should be sent with the VOID box checked.
• Furnishing Information: Each policy requires a separate Form 1095-A, and the information should relate only to that policy. Each tax filer receives a statement reporting coverage for their tax family.
• Correction of Information: If information reported on Form 1095-A is incorrect, it should be corrected and reported to both the IRS and the recipient as soon as possible, with the CORRECTED box checked.
• Advance Credit Payments: Column C requires the amount of advance credit payments for the month. If multiple forms are filed for the same family, only the amount allocated to the specific policy should be entered.

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

• Deadline for Filing: For coverage in calendar year 2024, Form 1095-A must be filed with the IRS and furnished to individuals by January 31, 2025.
• Void Statements: If a Form 1095-A is sent in error (e.g., for a stand-alone dental plan), a duplicate form should be sent with the VOID box checked.
• Correction of Information: If incorrect information is reported, it must be corrected on the Form 1095-A, with the CORRECTED box checked.
• Truncation of SSN: Social Security numbers can be truncated on statements furnished to recipients, showing only the last four digits.
• Electronic Filing: Forms can be furnished electronically if the recipient consents, and must be done by the due date or the next business day if the due date falls on a weekend or holiday.

Related Schedules and Forms for Form 1095-A

Form 1095-A is used to report information about individuals who enroll in a qualified health plan through the Health Insurance Marketplace. It is essential for taking the premium tax credit and reconciling advance credit payments. Here are the related schedules and forms taxpayers should consider:

• Form 8962: Premium Tax Credit. This form is used to reconcile the advance payments of the premium tax credit with the actual premium tax credit for the year.
• Form 1040 or 1040-SR: U.S. Individual Income Tax Return. Form 1095-A information is reported on these forms, particularly on lines related to health insurance coverage and premium tax credits.
• Form 8965: Health Coverage Exemptions. If applicable, this form is used to claim an exemption from the individual shared responsibility provision.

These forms are integral to accurately filing taxes when using information from Form 1095-A.

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

• Deadline for Filing: Health Insurance Marketplaces must file Form 1095-A with the IRS and furnish the statements to individuals on or before January 31, 2025, for coverage in calendar year 2024.
• Electronic Filing: If the regular due date falls on a Saturday, Sunday, or legal holiday, the statement must be furnished by the next business day. Consent is required for electronic receipt.
• Penalties for Late Filing: While specific penalties are not detailed in the provided context, failing to meet the filing deadline can result in penalties. It is advisable to consult the IRS guidelines or a tax professional for detailed information on penalties.
• Correction of Information: If incorrect information is discovered, it should be reported to the IRS and the recipient as soon as possible, with the "CORRECTED" box checked on the form.

Common Mistakes to Avoid on Form 1095-A

• Void Statements: Ensure that Form 1095-A is not sent for policies that should not be reported, such as stand-alone dental plans or catastrophic health plans. If sent in error, send a duplicate with the VOID box checked.
• Correct Information: Report corrected information on Form 1095-A as soon as possible after discovering an error, and check the CORRECTED box on the form.
• Furnishing Statements: Furnish Form 1095-A to individuals by January 31 of the year following the coverage year. Ensure statements are properly addressed and mailed or electronically furnished if consented to.
• Truncation of SSN: On statements furnished to recipients, truncate the SSN by showing only the last four digits and replacing the first five with asterisks or Xs. Do not truncate SSNs on forms filed with the IRS.
• Applicable SLCSP Premium: If a tool for determining the applicable SLCSP premium is not provided, enter the premiums for the SLCSP that would apply to all individuals identified as covered for the month.

Helpful Tips for Completing Form 1095-A

• Understand the Purpose: Form 1095-A is used to report information about individuals enrolled in a qualified health plan through the Health Insurance Marketplace. It is essential for taking the premium tax credit and reconciling advance payments.
• Void Incorrect Forms: If a Form 1095-A was sent for a policy that shouldn't be reported, such as a stand-alone dental plan, send a duplicate and check the VOID box at the top. Notify both the IRS and the recipient promptly.
• Correct Information Promptly: If any information on Form 1095-A is incorrect, report the corrected information to the IRS and the recipient as soon as possible, marking the form as CORRECTED.
• Furnish Accurately: Ensure each policy has a separate Form 1095-A, and the information pertains only to that policy. If multiple filers are enrolled in one policy, each should receive a statement for their tax family.
• Timely Filing: File Form 1095-A with the IRS and furnish statements to individuals by January 31 of the year following the coverage year. If this date falls on a weekend or holiday, file by the next business day.

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?