Margaret CPA in OH Posted March 12, 2015 Report Share Posted March 12, 2015 Client had PTC but doesn't qualify and has to pay back. But return check says to leave fields blank. If I do that and ignore the 1095A, she doesn't have to repay the credit which I don't think is correct as she does have to repay. It even says on Line 29 to enter that amount on 1040 line 46. Ideas?She probably wouldn't be averse to paper filing as she owes now big time. Quote Link to comment Share on other sites More sharing options...
rfassett Posted March 12, 2015 Report Share Posted March 12, 2015 Just had one over the weekend. Leave out the first two columns and just enter the PTC column, that will then flow to the 1040. 1 Quote Link to comment Share on other sites More sharing options...
Terry D EA Posted March 15, 2015 Report Share Posted March 15, 2015 Margaret you are correct they have to repay the PTC. This usually is result from under estimating their income. Had one this morning with the same thing. Does ATX pull from the 1095A input? I haven't used ATX for a number of years is why I am asking. My program does this without a hitch. Quote Link to comment Share on other sites More sharing options...
Margaret CPA in OH Posted March 15, 2015 Author Report Share Posted March 15, 2015 Yes, ATX did a fine job of managing the repayment calculations. It took me a bit to understand the correct process. Reading the instructions for the form actually helped! Quote Link to comment Share on other sites More sharing options...
Cathy Posted March 25, 2015 Report Share Posted March 25, 2015 The biggest flaw in the new program I see is having participants estimate their income rather than using the income from the prior year such as Pell grants are awarded. It's almost impossible to make an accurate estimate especially for self employed individuals which is one group that was advertised would benefit from Obamacare. A work around, of course, is to not accept the premium credit until the end of the tax year, however there are those who couldn't afford insurance at 100% of the premium during the year. Quote Link to comment Share on other sites More sharing options...
BulldogTom Posted March 25, 2015 Report Share Posted March 25, 2015 The biggest flaw in the new program I see is having participants estimate their income rather than using the income from the prior year such as Pell grants are awarded. It's almost impossible to make an accurate estimate especially for self employed individuals which is one group that was advertised would benefit from Obamacare. A work around, of course, is to not accept the premium credit until the end of the tax year, however there are those who couldn't afford insurance at 100% of the premium during the year. If we are going to be stuck with this law, at least they could use the prior year income, and then allow for changes if there is a "life event". They already have a mechanism for that to open enrollment, so why not use the prior year, and if you can document that your income in the coming year will be less, then you go through the estimating thing and take your chances. I like your thinking on this Cathy. Tom Newark, CA 3 Quote Link to comment Share on other sites More sharing options...
Terry D EA Posted March 25, 2015 Report Share Posted March 25, 2015 I agree but the other problem is those who won't report a life changing event that affects the PTC. Quote Link to comment Share on other sites More sharing options...
easytax Posted March 25, 2015 Report Share Posted March 25, 2015 I agree but the other problem is those who won't report a life changing event that affects the PTC. Agreed there will be many ---- but that is something we as a country need to change anyway ---- If the people themselves will not bother ---- then they are responsible and have to live with it. Personal responsibility is GREAT --- otherwise too many people say --- why bother, someone will feel sad (and take care of me (even when I would not myself))) . Nothing more said as it gets into morals and such ...... 1 Quote Link to comment Share on other sites More sharing options...
Lion EA Posted March 26, 2015 Report Share Posted March 26, 2015 People didn't report life events during 2014 under the existing system. At least with your suggestion, the initial income estimate has some basis in fact. Then it's up to everyone to report their own life events when they happen. Quote Link to comment Share on other sites More sharing options...
Jack from Ohio Posted March 26, 2015 Report Share Posted March 26, 2015 These situations are more symptoms of the nationwide debilitating disease known as Intentional Apathetic Ignorance. It is highly contagious, and completely addictive. 1 Quote Link to comment Share on other sites More sharing options...
Cathy Posted April 4, 2015 Report Share Posted April 4, 2015 Margaret, You didn't say why your client wasn't qualified for the credit. Too much income (over 400% of poverty level) and entire credit has to be repaid. Under 100% of poverty level and the payback is capped at a much lower payback. Pay close attention to the form. Quote Link to comment Share on other sites More sharing options...
Cathy Posted April 4, 2015 Report Share Posted April 4, 2015 Margaret. Also you do have to enter the column that gives the amount of the monthly PTC. Quote Link to comment Share on other sites More sharing options...
Margaret CPA in OH Posted April 4, 2015 Author Report Share Posted April 4, 2015 Cathy, thanks for the comments. The client didn't qualify for the credit as income was 579% of FPL, hence full repayment required. When I more carefully followed and understood better all the instructions, it all worked out. Client majorly underestimated her income. Quote Link to comment Share on other sites More sharing options...
Cathy Posted April 5, 2015 Report Share Posted April 5, 2015 Margaret, Two of my clients whom I tipped off to the coverage because the primary taxpayer's parkinson disease had progressed to the point he no longer could work, had a total withdrawal of $200K from a 401(k). Did they bother to mention to me when they decided on the withdrawal? Of course not! And, as your client, mine had to pay back 100% of the PTC as their final income was over 800% of the poverty level. Just another reason why it would be better to use the prior year's income in calculating the PTC. As the $200k was withdrawn toward the end of 2014, it would make more sense for the taxpayers to not receive a subsidy in 2015 as they have enough funds NOW to pay 100% of their 2015 total premium. It all goes back to the tip my dil (a 20 year employee with BCBS) gave me anyway! "You're not licensed to sell insurance. Tell your client(s) to contact an insurance agent from one of the companies on the marketplace if they are not able to obtain a policy online themselves." All I can do is to continue to tell each client to let me know BEFORE they make a financial decision on withdrawals, etc. so I can tell them the tax consequence BEFORE they decide. And, now, in addition to income taxes, I tell them to contact their insurance agent also to see what ramifications the withdrawal will have on their subsidized insurance. I can suggest the withdrawal might cause them to pay back part or all of their subsidy, but strongly suggest that they contact their insurance agent/company to report the change and find out exactly what the effect the withdrawal will have. We have to walk a fine line and COA at the same time. The clients blame their agent (and not me, thanks to my dil's advice) for not telling them to report changes in income during the year...which I find hard to believe, but am grateful the monkey isn't on my back! Just a little editorial but it may be helpful for others to read later. Take care, Cathy 1 Quote Link to comment Share on other sites More sharing options...
Cathy Posted April 6, 2015 Report Share Posted April 6, 2015 Margaret, You didn't say why your client wasn't qualified for the credit. Too much income (over 400% of poverty level) and entire credit has to be repaid. Under 100% of poverty level and the payback is capped at a much lower payback. Pay close attention to the form. For the record: To clarify my above post, if the MAGI is less than 100% of the poverty level, pay particular attention to Line 6 and the instructions. There is a tab at the bottom of the form on the screen "Pt 1 - HI below FPL". If taxpayer can check either Box A or Box B under the tab, he/she is eligible for the PTC. If the taxpayer can't check either box, then the payback is capped at a much lower payback. Quote Link to comment Share on other sites More sharing options...
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