California taxes - I have Covered California and my wife is receiving Medicare. Right now we are filing jointly, but I think only getting a tax...

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Mike,

Generally, someone who is eligible for Medicare — even if they do not enroll in it — cannot receive tax credits to help them pay for a Covered California health plan. So, if you are eligible for Medicare & decide to have a Covered California health plan, you cannot receive tax credits!!

If Covered California enrollees become eligible for, or enroll in, Medicare, it may affect their eligibility for financial assistance. They must report their eligibility for or enrollment in Medicare to Covered California within 30 days. They should contact Covered California for more information about how their Medicare eligibility or enrollment affects their Covered California health plan.

Also, one of my clients had Health care insurance offered to them and were told that they were eligible for a tax credit ($563.00) every month on their insurance.  After filing their taxes for 2017,  IRS asked them for form1095a. When they looked at the 1095a on Healthcare.gov, They owed $5,139 to IRS.

If you are married and filing separately, you and your spouse will not be eligible for a subsidy.

It doesn't matter what your income is. If you are married, you must file the current year's taxes as jointly to qualify for a subsidy (if eligible based on other considerations). Important note...last year's tax filing status doesn't matter. For example...you might have filed as separately last year but if you file jointly for this current year, you may be eligible for the subsidy.

When you enroll in coverage, the Marketplace will estimate the amount of the premium tax credit you will be allowed for the year of coverage. To make this estimate, the Marketplace uses information you provide, including information about:

• Your family composition
• Your household income
• Whether those that you are enrolling are eligible for other non-Marketplace coverage

Do I ever get any money back if my income is less than projected – yes, when you file your tax return.

If you received the benefit of advance credit payments, you must file a tax return to reconcile the amount of advance credit payments with the amount of the actual premium tax credit you are allowed. You must file an income tax return for this purpose even if you are not otherwise required to do so.

If you choose not to get advance credit payments, you can claim the full amount of the premium tax credit that you are allowed when you file your tax return. This will increase your refund or lower the amount of tax you owe.

 Victor Santucci  EA

Mike,

Do you need further assistance with your original question?

Victor Santucci EA

2 = yes must file MFJ

3 = If you file MJS you are not eligible for the credit , 

4 = correct you lose the credit if you file separately

5 & 6 = if you over paid by using a higher income then when you file your tax return you tax liability would be reduced. So you would owe less or if overpaid you would receive a refund from the IRS.

Mike,

All this means if you are eligible for a credit and chose not to reduce the monthly premiums, you would get the credit due you when you file your tax return.

Victor Santucci  EA