1095 A

[Sue5]

Hello I am running into a problem with the 1095-A. I have a client that had a monthly premium credit. Her husband had filed for social security disability and he received a large payment from social security. including 2017 & 2018 payments. This increase in 3 years income pushed them over with their premium allowance and they will owe a large amount back ($30k).  Has anyone experienced this problem and know a way to correct this? 

[RollTide68]

Had that problem last year when a client won a disability claim through an employer and pushed his income over the limit.  No way around it that I know of.

[abctax55]

There's nothing to *correct* as that's what happens when income spikes. 

The only options:

IRA, or HSA or SEP (if self-employed) to reduce income below the 401%.  OR, look at MFS - it sometimes can help.

You also should look at the treatment/taxation of the SS benefits received for prior years.  It may not help with the 1095-A situation.  You basically look at the prior years to see how much would have been taxable in prior years IF received in that year then adjust the taxable amount of the SS for the current year. 

[Sue5]

included on the healthcare premium was their son. Do you think I could amend to include the son? he was a student the first half of the year but had income of $25k. I did do the proper allocations for the ss prior years.

by the way...thanks for the response.

[abctax55]

paging @TaxGuyBill 

He's our expert on all things APTC 🙂

[TaxGuyBill]

---

@Sue5 wrote:

included on the healthcare premium was their son. Do you think I could amend to include the son? he was a student the first half of the year but had income of $25k. I did do the proper allocations for the ss prior years.

by the way...thanks for the response.

---

What are you wanting to amend?

Does the son qualify as a dependent?  You need to determine if the son paid for over 50% of his own support.

Are all three of them listed as "covered" on the 1095-A?

[abctax55 · Accepted solution]

(we love you, Bill 🙂

[linette]

Did you complete social security information for prior years?

Sometimes this will reduce the amount of income.

[Sue5]

YES. ALL 3 ARE ON THE 1095-A

[Sue5]

YES

[TaxGuyBill]

---

@Sue5 wrote:

YES

---

Is that second yes responding to my question about the son qualifying as a dependent?  Or was that answering the other person's question about the Social Security Worksheet?

[Sue5]

actually it was answering the social security question...sorry new to this community!

The son filed on his own so I would need to amend both.

I filed without knowing they had a 1095-A...new client jus said they had insurance.

The mom tells me she supported him and he did live with them. Parents and child were on the 1095-A.

Son came off in August when he qualified to purchase thru his new company that he was hired at.

He just graduated in May from college. I have to see his return and ask mom more questions. She is coming in tomorrow and I wanted to see if anyone had suggestions.

thanks for taking the time.

[TaxGuyBill]

It sounds like the dependency depends on if the son paid for over 50% of his own support or now.  You may want to look at the IRS worksheet to help you determine that:

https://apps.irs.gov/app/vita/content/globalmedia/teacher/worksheet_for_determining_support_4012.pdf

Once you find out if the son qualifies to be a dependent, post back here and we'll see what we can do.

Also, when talking to the mom, you may want to ask her if they are able to contribute to an IRA *IF* it would save them a bunch of money on their tax return.