California Shared Responsibility Penalty

Forum|Forum|5 years ago
August 11, 2021
9 replies
42 views

I did a return for a couple, no kids, California AGI was $32,000. One spouse had insurance for just one month in 2020. The other spouse had none. The return showed a $1,250 penalty - $750 for the spouse with no insurance and $500 for the other spouse (8 months). They just got a refund of the entire $1,250. Does anyone know why? They are supposed to get a letter with an explanation but I'd like to understand this.

ProSeries Professional

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Just-Lisa-Now-

Intuit Community Champion

Was their income low enough that the penalty shouldn't apply? (Im not sure what the limit is right offhand)

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪

Just-Lisa-Now-

Intuit Community Champion

I know the program did have an issue with penalty computation early in the season when partial year coverage was marked. Open the clients return again now and see if the penalty computes.

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪

U

Username is two wordsAuthor

Level 5

I opened up the program. The CA return has not changed. Using only their CA AGI of $32,000 I tried this: https://www.ftb.ca.gov/file/personal/filing-situations/healthcare/estimator/

and got the same result, a penalty of $1,250. Their California AGI is $32,000 but that is only because UI is excluded. Their combined UI was about $47,000 so their household income approaches $80,000, and it is my understanding that counts in determining if they get hit with the penalty.

I don't see a reason for them to not owe it. Yet, they got it back.

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