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Client can't deduct the mortgage interest because client has no ownership interest in the property. Mother can't claim the deduction because she didn't make the payments.

That's great, Tom, and I'm glad to have helped both you and your client. That is a big savings to not have to pay with the added bonus of saving for retirement too.

So I'm really curious about how ATX handled this. In calculating MAGI for purposes of the PTC reconciliation, isn't the program adding back the difference between lines 20a and 20b no matter what year it is for? That is what should happen according to §36B(d)(2)(B ). I couldn't find anywhere that said SSA payments of prior years received in the current year as a lump sum can be excluded.

Have you considered updating to the current version? Keeping older versions like that presents a security risk.

Go to MyATX, about 1/2 way down the list at left, click on ATX forms schedule. The page that is displayed shows that the planner is scheduled for release on 2/6.

What was the income the wife received? Was it SSA, SSI, or SSDI? It makes a difference in calculating household income depending on which it was.

8962, part 2, you are only filling in boxes for May to Dec, right? What is in col E. I think it should be ~ $13/month, and it appears that he was receiving about $200 too much each month from May - Dec. If that is the case, yes I'd agree that the repayment of the APTC is $600 in this case because it is capped at that. It appears that his household income just squeaks by at being less than the 200% of FPL. One percent more and he would have had a repayment of $1500, not $600.

Errrg! Tom, you are correct. In my haste I looked at the wrong column. The max payback is the $1250, and that makes the max sec 162 deduction under the alternative formula #2 to be $1595...if *I'm * on the right track with this mess. That will also raise his MAGI and AGI, so if trying to use the retirement contribution or HSA to get him below the 400% of FPL it will need a larger investment of funds.

Ok, trying to make sense of the 2nd optional calc in 2014-41, the max sec 162 deduction would be $2,845. That is made up of the net out of pocket prem of $345 (after the advanced credit he received ) plus $2500, his max amount of the repayment. That much seems clear (ha!), and kind of makes sense that if he has to repay some of that credit, then he should be given the opportunity to use that as part of the sec 162 limitation. So, going with that assumption... I think his MAGI and AGI would be : SE income 31666 SEHI (2845) SE tax (2036) subtotal 26785 SS inc @ gross 19746 MAGI = 46531 exceeds 400% FPL and would eliminate him ever having qualified for the PTC Actual - SE inc 31666 SS taxable 6759 162 SEHI (2845) 1/2 SE tax (2036) AGI 33544 I think.... I did this on scrap paper by hand including the taxable portion of SS, all late night. Don't hold me to it and please recheck. It does appear though that this person would benefit by making a contribution to an IRA or HSA, at least enough to have the MAGI to not exceed the 400% FPL and possibly limit that payback. I didn't go any further to calculate the actual premium tax credit to see if this all proves out either. I also started with the optional calculation since you said trying to use the iterative calculation wasn't working out, and I wasn't using a spreadsheet or program to easily plug in the continual changing of numbers to see if the differences were truly within $1.

Is this person single with 1 exemption, and were his total premiums before the advanced credit the $6179?

Tom, if you are using 2014-41 and the first method, the "iterative calculation", step 6 says that if repeat step 5 results in a difference in the SEHI and PTC of less than $1, then use the 162 deduction and the PTC with those specified premiums, but if the difference is more than $1, then basically it means that you have to keep playing with the amounts until you get the difference down to that $1 (basically fooling with the numbers until it works out). That is a maddening situation. If you can't get it to work, you are supposed to then use the second calculation in 2014-41. Let me ask you this - does he have a retirement plan established for the business that he could contribute toward to alleviate this problem, or fund an IRA? If he had a high deductible plan, he's still under the 65 age limit and could also still open and contribute to an HSA for 2014 up until 4/15 of this year. Any of those can be used to reduce AGI for a taxpayer that exceeds the MAGI and is in a situation where they might have to repay the advanced premium credit and haven't greatly exceeded the 400% of FPL amount that applies to them. Also, without repaying that advanced credit, if the return would otherwise show a refund, the refund could be used to help fund those contributions.

We are ALL still finding and learning intracasies of the ACA as we go along, and we are just now working with the forms and the worksheets to put it all together. No one here knows it ALL, not even you, Jack, and we all make mistakes from time to time too, so I'll ask you again to please stop with these type of comments. If you don't like my statement or think it doesn't apply to you, I'll gladly recall and review our "discussion" from last month about sec 5000A where you demanded that I find the definition of MAGI as it relates to the shared responsibility payment, which I did do by the way, or more recently where you and I were both wrong about the short coverage gap being "less than 3 months" and not "3 months or less" where you asked Pacun for a cite to prove that to you. No one posting here should be embarrassed, demeaned, or belittled for asking a question or making an incorrect assumption or statement.

I agree with Tom, or I might not even take the mileage. I've run into campsite park "attendants" that were doing this in the summer months. The last was a retired couple that did this as their vacation during the months of nicer weather when this little park was open. They'd drive their RV to the campground, park it there for free in exchange for acting as the attendant for park that didn't otherwise have staff and needed someone onsite to answer questions and collect the fees.

No, a person No, that is not correct. A person can file for an exemption due to bankruptcy at any point during the tax year on the marketplace, and if granted, the exemption will be for the remainder of that calendar year. From the marketplace: How long a hardship exemption lasts Hardship exemptions are usually provided for the month before the hardship, the months of the hardship, and the month after the hardship. However, the Marketplace may provide the exemption for additional months after the hardship, including up to a full calendar year. For a hardship exemption based on affordability, the exemption will be granted for the remaining months in the coverage year. For people ineligible for Medicaid only because a state hasn’t expanded Medicaid coverage, the hardship exemption will be granted for the whole calendar year. For people eligible for Indian Health Services, the hardship exemption will be granted on a continuing basis. It may be kept for future years without having to submit another application. This is true as long as there are no changes to your membership in a tribe or eligibility for services from an Indian health care provider.

Jack, cut it out. These type of statements are not helping!!! We have tax preparers here with a lot of experience that are asking questions about the law, and now even asking for help with how to fill out the forms and worksheets, and some of those answers are found right in the instructions to these new forms. We need to help each other, not beat each other up.

All sources I've read say to supply "official bankruptcy filing documents" from a date within the last 6 months. That sounds like from within the last 6 months immediately preceding the application being submitted. One of the confusing things about this is that the application for the exemption has a space for stating when the hardship began, so suppose the individual filed for bankruptcy on Feb 1st and entered that date as when the hardship began, but didn't file for the exemption until sometime in Sept, is he/she then out of luck for the exemption?

See pg 6 of the instructions for form 8949 for how to properly complete columns (f ) and (g ) when the basis is incorrect and how to enter the amounts to reflect the proper gain or loss.

Nope, that's really for the whole year. 2015 will be higher. In those calcs, the 1% increase to 2%, and the flat dollar of $95 jumps up to $325

Yes, looks correct for someone under 65 that is filing HOH. Penalty in this case is excess of household income 30227 over filing threshold of 13050 = 17177 * 1% = $172 penalty

You will have to wait until ATX releases the official version of the form.

^ that. You already found that the solution is to print to pdf if you choose to duplex those forms.

ILLMAS, you should only check the months without insurance AND for which they don't meet one of the the exemptions. It sounds like they should not owe any penalty.

Ms Tabby, I hear you loud and clear about not wanting to be any more involved or waste more time. If you do cut him loose, I would at a minimum write him a letter making him aware that because he overstayed, that taxes may be assessed on those prior years. If you don't want to run those calculations, at least make the situation known to him so to put that responsibility back to him, not on you for not making him aware.

I think you are being too literal. His absence is due to the military service, and if that wasn't the case, wouldn't he be living in the home with his wife now, so isn't the "absence" due to the military posting with the expectation that ultimately they will live together when his military duty ends? I just wouldn't be comfortable at all filing the wife's return as anything other than married.

In case anyone here downloaded the instructions like I did, the IRS made some revisions a little more than a week ago and posted this on the IRS website: Changes to Instructions for Form 8965 -- 23-Jan-2015 If you downloaded the Instructions for Form 8965 before January 22, 2015, please note the following. The Types of Coverage Exemptions chart on page 2 of the instructions has been revised. A checkbox has been added to the "Claimed on tax return" column on the line for the coverage exemption labeled "Income below the filing threshold." If you are not required to file a tax return, your tax household is exempt from the shared responsibility payment and you do not need to file a tax return to claim the coverage exemption. However, if you choose to file anyway, you can claim this coverage exemption on Part II of Form 8965. The Types of Coverage Exemptions chart on page 2 of the instructions has also been revised to remove the checkbox from the "Granted by Marketplace" column on the line for the coverage exemption labeled "Resident of a state that did not expand Medicaid." The coverage exemption described on this line can be claimed on your tax return. However, if you applied to the Marketplace for the similar coverage exemption for individuals who resided in a state that did not expand Medicaid, see the line on the Types of Coverage Exemptions chart for the coverage exemption labeled "Determined ineligible for Medicaid in a state that did not expand Medicaid coverage." Line 10 of the Marketplace Coverage Affordability Worksheet has been revised to read as follows: "Enter the monthly premium for the second lowest cost silver plan premium that covers everyone in your tax household for whom a personal exemption deduction is claimed, who is not eligible for minimum essential coverage (other than coverage in the individual market), and who does not qualify for another coverage exemption for the month. To find the second lowest cost silver plan go the Marketplace for your area." The revised version of the Instructions for Form 8965 is available for download. Page Last Reviewed or Updated: 23-Jan-2015