You are expected to report life changes or events to the insurance market as they happen in order to avoid tax surprises.  This will help you get the proper type and correct amount of financial assistance.  It will also make you eligible for a reasonable advance if and when you need it.  Getting too little or too much in advance has often affected the refund or balance due when a beneficiary files tax returns.

Consider a situation where you don’t report an income change to the marketplace.  It will be assumed that no changes occurred.  When you apply for credit, the advance amount may not match the amount you qualify for under federal tax return leaving you with a smaller refund or a balance due.

This article discusses:

  • Why you should report life changes to the marketplace
  • Changes that you should report
  • How to report life changes
  • Application for 2015 coverage

Why should you report life changes?

Anyone enrolled in insurance coverage through health insurance marketplace is required to report to the marketplace certain changes to their lives that affect their eligibility for and the amount they can receive as Advance Premium Tax Credit (APTC).  APTC is a figure used to reduce the amount you pay towards monthly healthy insurance.

Reporting changes helps to eliminate complications that may arise on the beneficiary’s tax return enabling the insurance marketplace to properly report APTC and coverage premium changes in case there is a change in family circumstances such as a separation or a divorce.  When you report the changes, the marketplace will report APTC and premium costs on a 1095 form.  This makes it possible to reconcile APTC to the premium tax credit you rightly qualify for on your tax return.  Early reporting and tax preparation is the way to go if you are to avoid surprises on your tax returns.

Changes that you should report

  • Becoming pregnant
  • Changes in income
  • Changing your place of residence
  • Changes that you feel might change the size of your household or income
  • Gaining or losing a dependent
  • Getting a child, adopting a child, or letting someone adopt your child
  • Getting health insurance from your employer or through a program like Medicade or Medicare
  • Having a child,
  • Getting married
  • Having a change in disability status
  • Other changes such as; change of citizenship, change of immigration status, change in status as an American native, change in tribal status, incarceration or release from incarceration, and correction to Social Security number, name, or/and date of birth.

How to report changes

Though the 2014 coverage is about to end (it ends on December 31, 2014), you can still report 2014 changes.  Log into your marketplace account, locate your existing 2014 application and click on “Report a life change” on the drop down menu.

Applying for 2015 coverage

2015 is just around the corner so you may already be thinking about making an application.  The 2015 application form will be available as from November 15, 2014.  The form comes pre-filled with some information from 2014.  You can make changes to the form as appropriate to get your new eligibility results for the 2015 coverage.  Go ahead to pick a plan and enroll.

If you encounter any challenges with any of the processes, contact your accounting services provider.