ACA

[Christian]

Like most of us I have begun acquainting myself with the requirements of the ACA with regard to how it will affect us as practitioners. Most of the folks I work for are covered by Medicare or through their employer. As I understand it an individual purchasing coverage through an exchange will receive a form from the insurer much as they now get a W-2 or other federal form. I would assume they would have to bring this along with their other info in order for the preparer to indicate certification of insurance on their tax return. For individuals covered by the employer, would they also receive a form certifying coverage? Any input on this subject would be appreciated.

[Gail in Virginia]

I don't know if they will get a separate form, but I understood that employers had to begin showing on the W2 the cost of health insurance provided. I thought perhaps that would be sufficient information for the ACA coverage requirement.

[Christian]

I note that also Gail. I suppose they will need to indicate if dependents are covered under the employees coverage as we have no way of knowing. Judging by the amounts being paid for coverage you would certainly think the kids are covered.

[Lynn EA USTCP in Louisiana]

Gail, the caveat is that employers who employee more than x # of employees are required to reflect the health insurance costs on the W2. None of my clients exceed that x # , so my clients employees W2s will NOT have any information regarding health insurance costs . My clients will not go to the trouble to track it nor are they willing to pay me to do so.

Lynn

[Jack from Ohio]

Each person that is insured will receive a 1095-B from the insurer, regardless of where they get the coverage or who pays for it. It will show the dates of coverage and other information. Very similar to the MA 1099-HC. It will also include information about the amounts of any subsidy the taxpayer receives.

Employers that provide health coverage for their employees will send a 1095-C form to each employee showing how much is paid by the employer and how much is paid by the employee.

There will be 2 additional forms needed for every Federal return.

One will be used to calculate any subsidy to see if the correct amount was received. This could cause an additional refund amount or additional tax, depending upon the numbers entered when the person signed up through the exchange compared to the actual numbers on the tax return.

The second will be to calculate any penalty for not having insurance for the adequate amount of months and to calculate if employer provided insurance is "affordable" by the ACA standards.

I am instituting another increase in my fees. I have spent 16 hours of training time on the ACA alone in the last 12 months and expect at least that much this coming summer and fall.

As preparers, we are also be held accountable for the accuracy of information on these two forms.

My increase will be totally "blamed" on the ACA and the requirements I must meet to properly document and report this information on the 2014 tax return.

I am expecting a good year for 2014 because there is no way the "DIY" tax programs or "Freefile" can ask the proper questions nor vette out the answers given. Much confusion means greater demand for my knowledge and services.

[Christian]

Jack an old duffer like myself can always depend on you for correct and detailed info. That answers my question and like you I see fee increases coming. I'm sure the big chains are licking their chops over what's coming.

[Christian]

Good grief. We are not expected to fill in two additional federal forms for EACH client Jack ? Somehow I feel faint.

[Jack from Ohio]

Good grief. We are not expected to fill in two additional federal forms for EACH client Jack ? Somehow I feel faint.

If your client is uninsured, only one. If he is insured, then two is the number.