For the family of a small business owner, the reduction of the MAGI because of the 20% deduction could drop any dependents under 18 years old into Medi-Cal. A family of four earning $70,000 makes all the household members eligible the tax credit subsidy through Covered California. If the family reduces their income by the 20% deduction, the new income is $56,000. That is below 266% of the federal poverty level for a family of four and all dependents 18 and younger are then deemed eligible for Medi-Cal.
If a consumer was in a market where the only choices were Blue Cross and Blue Shield, and Blue Cross was the SLCSP (Blue Shield necessarily being the least expensive Silver plan offered) then these consumers may see their relative tax credit subsidy decrease. This will hold true if the Blue Shield plan, and now the only plan available, continues to have a rate lower than what Blue Cross would have had in 2018.
Given the Republican philosophy that less government is better government, Covered California’s reason for existence may evaporate. But it all hinges on Trump’s term ‘transition’. Does he want to transition away from the Marketplace Exchanges, or is he merely suggesting transitioning away the Qualified Health Plans as a requirement for the tax credit?
The Department of Health Care Services (DHCS) has developed a Medi-Cal household size flow chart. The DHCS Guide for Calculating MAGI Medi-Cal Individual Household Size was originally developed to help county eligibility workers ascertain the actual household size under the new Affordable Care Act (ACA) rules. The newly expanded Medi-Cal eligibility under the ACA revolves around on IRS definitions for tax dependents and non-filer rules. Because families can be so diverse and the rules regarding what constitutes a tax family so complicated, the flow chart for determining household size was created.
At the end of June 2015 the Centers for Medicare and Medicaid Services (CMS) announced that they had boosted the reimbursement for high cost health care claims to health insurance companies participating in the ACA reinsurance program from 80% to 100% for 2014. The increase in coverage resulted from fewer requests for coverage of high […]
The IRS issued guidance on whether tax payers should file an amended return once they receive a corrected 1095-A from either the federal or state exchange such as Covered California. You do not need to file an amended return based on your corrected Form 1095-A. This is true even if additional taxes would be owed […]
Publication 974, released by the IRS in March 2015, is a fairly comprehensive review of the ACA health insurance premium tax credit rules. Its release is long overdue as many Americans have struggled to understand how the Advance Premium Tax Credits (APTC) afforded by the ACA interact with their federal taxes. Publication 974 addresses many different […]
The Treasury Department has decided to expand their February 24 announcement waiving collection of under reported health insurance tax credits to states that are running their own Marketplace exchanges. Tax payers who already filed their tax returns using incorrect 1095-As issued by Covered California will not be subject to the collection of excess Advance Premium […]
Most people are under the impression that if they purchase health insurance through a Marketplace exchange such as Covered California they have to accept all the monthly tax credit offered. Individuals and families don’t have to have any of the tax credit applied to their monthly health insurance premium. Covered California has introduced a new link on consumer’s […]
The IRS has issued additional guidance on ACA Advanced Premium Tax Credits and relief from certain penalties associated with the taxpayer receiving excess tax credits from a health insurance Marketplace. IRS Notice 2015-9 Penalty Relief Related to Advance Payments of the Premium Tax Credit for 2014 outlines how some taxpayers may not be subject to the penalties […]