Close to 80,000 of last year’s Obamacare customers still haven’t received a corrected tax form after the Obama administration distributed hundreds of thousands of faulty forms.
The Apr. 15 deadline for filing taxes is just weeks away and for the first time, Americans have to include their health insurance information. The administration admitted last month that it sent inaccurate tax documents, the new 1095-A form for Obamacare plans, to 820,000 people. Officials said Friday that only 741,000 of those customers have received corrected forms.
The administration said the remaining 80,000 customers should expect their updated information within the next week, either electronically or in the mail.
The 1095-A forms determine whether a customer was, in fact, eligible for tax credits to help offset premiums on Obamacare exchanges. When purchasing health coverage on exchanges, customers estimate their income for the upcoming year and receive a monthly subsidy on their health coverage accordingly. But at tax time, if they’ve incorrectly projected how much they earned, they may end up owing the IRS money or could expect some back. (RELATED: Obamacare ‘Clawback’ To Hit Some Subsidy Recipients With Huge Tax Bill)
The administration says a coding error led to an incorrect box on the form, which botched the subsidy calculations.
Although the deadline to file taxes is growing uncomfortably close, the administration is not planning on giving Obamacare customers who were sent flawed forms any extra time to file their tax returns, according to the Treasury Department’s assistant secretary for tax policy, Mark Mazur.
Roughly 50,000 people who received incorrect forms had already filed their taxes by the time the Obama administration revealed the error. The Treasury Department has already announced that customers who already filed their taxes with the botched forms and actually owe the IRS more money won’t have to refile their taxes. Mazur added Friday that customers who deserved higher premium subsidies than they were awarded with the incorrect forms can choose to re-do their taxes this year, although they won’t be required to do so.
Americans who didn’t purchase health insurance on an Obamacare exchange won’t have much extra tax work this year. Most taxpayers will have to check an extra box on their tax forms to attest that they had health insurance through their employer in 2014, but the Obama administration is taking people at their word. Because the White House delayed the employer mandate and the extensive filings it required businesses to submit regarding employees’ health coverage, the administration isn’t able to double-checked whether tax filed actually have employer-based coverage this year.