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Marie

ACA penalties and the 8965 worksheet

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Keep going over this worksheet, getting my silver and bronze plan figures, and it seems to just run me around from tab to tab. 

Line 10, if there is a silver amount, does it always go in.  Most of the time, putting that is always makes Obamacare affordable and no exemption

for unaffordable.

Anyone have something easier?

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My state has bronze plans so I just lookup bronze and enter x12 on the Affordability tab. If the calc says they could have afforded it, I go to Worksheet A and check the months each person wasn't covered. The step 4 on SRP questions is automatic, so SRP is calculated.

But I could be doing it wrong!

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I'm working on one now, because the client just knows coverage was unaffordable.  Unaffordable does not mean what they think it means.  The clients think if the premium is more than 8.16% of income, it's unaffordable.  But it's the "required contribution" that has to exceed 8.16%.  These people fall right in there at 269% of poverty level, so they would have gotten insurance practically free.  That's affordable.

Logically, it seems to me that this exemption would be as rare as hen's teeth.   Logically, I get it.  But these worksheets.  Wow, these are the worst.  Well, that iterative calculation for SEHI might beat them, there's that.

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46 minutes ago, Abby Normal said:

The more you know.... the more you wish you had become a sound engineer for music.

My first choice was professional basketball player.  But when I got cut from the freshmen basketball team, I went for my 2nd choice, rock star.  But then I found out I had to learn to play the guitar.  That didn't work out.

 

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I also have a client that just KNOWS the coverage was unaffordable and basically demands that I use that exemption to get her out of the penalty.  Income is approx. $24,000 so her required contribution is approx. $163/month.  No bronze plan available because she smokes and smokers are required to go silver if they want the subsidy.

I explained to her that the IRS expected her to obtain coverage and that after the subsidy, the IRS views it as affordable.

 

Client claims that even after the proposed subsidy, her cost for the cheapest plan actually offered to her through the marketplace would have been $250/month?  What do you do if the cost of the only plan offered to the taxpayer is more than the SLCSP used in the 8965 Affordability calculation? 

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59 minutes ago, Janitor Bob said:

I also have a client that just KNOWS the coverage was unaffordable and basically demands that I use that exemption to get her out of the penalty.  Income is approx. $24,000 so her required contribution is approx. $163/month.  No bronze plan available because she smokes and smokers are required to go silver if they want the subsidy.

I explained to her that the IRS expected her to obtain coverage and that after the subsidy, the IRS views it as affordable.

 

Client claims that even after the proposed subsidy, her cost for the cheapest plan actually offered to her through the marketplace would have been $250/month?  What do you do if the cost of the only plan offered to the taxpayer is more than the SLCSP used in the 8965 Affordability calculation? 

File according to the IRS regulations, or don't file at all.  Your neck is on the line too.  Not worth it!!

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so I am looking at the affordability - and I do not see where you enter a 12? it asks for the annual required contribution - would that not be the bronze cost per month x 12? so a family of 3 is $1,308.95 x 12? - that is ridiculous!! or $307 is the contribution  x 12 -= $3,684 under marketplace coverage -

or in other words - the penalty of $695 x 2 is less than anything else!!

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