(PRWEB) February 28, 2015
Nearly 800,000 American taxpayers who are enrolled in the Affordable Care Act’s insurance programs through Healthcare.gov have been affected by a major glitch involving how much they owe Uncle Sam in taxes this year, according to a report from CBS News released on Feb. 21, 2015 (http://www.cbsnews.com/news/800000-healthcare-gov-users-given-wrong-tax-info/).
Taxpayers received erroneous information from the government. Because of this error, they were told to hold off on filing their tax returns with the IRS until the problem is resolved.
The erroneous information about taxpayers’ insurance policies involves calculations related to how much they owe in taxes. The government said that taxpayers should receive corrected information during the first week of March. However, until then, they will not know for sure what they owe as some are expected to owe more and some may owe less than what the incorrect information indicates. This will delay the ability of many taxpayers to file their returns in a timely manner.
According to officials, there is still no answer on what caused this invalid and unusable information to be distributed. An estimated 20% of all forms sent out with this type of insurance information contained incorrect calculations. The information was included on copies of Form 1095-A, which is the equivalent of a Form W-2 for health care. The forms contain a monthly record of the subsidies consumers received in 2014 to help pay their insurance premiums.
This is the first tax season in which Americans can face a tax penalty for failing to have health insurance through either a private provider or through the healthcare exchanges. February 15th was the original deadline for taxpayers to get insurance through Healthcare.gov if they were uninsured and did not want to pay the penalty on their taxes. However, the government is opening a second enrollment period for those who have not yet purchased insurance.
This special enrollment period will begin March 15th and ends on April 30th. It is currently set to take effect in 37 states, but the others are expected to follow suit in some capacity. In Minnesota, for instance, taxpayers will have from March 1st to April 30th to get insurance and avoid a penalty.
According to federal officials at the Treasury Department, approximately 6 million individuals will be on the hook for a penalty since they did not have health insurance in 2014. But there are 30 different exemptions on the books for being uninsured, which means some of these taxpayers will not incur a fine at tax time. There are also tax credits and other ways around being uninsured to assist certain individuals.
In addition to the nearly 1 million taxpayers impacted by this glitch, an estimated 50,000 who have already filed their income taxes will be required to resubmit their returns.
Brendon Pack, Vice President at 1-800Accountant, said this tax glitch is just one piece of a widespread confusing puzzle in the 2015 tax season.
“This glitch represents only a small part of how difficult the 2015 tax season has been for Americans,” Pack said in a statement. “Both individuals and business owners alike are experiencing so many challenges in getting their taxes filed properly and on time. 1-800Accountant is staffed with a team of experienced accountants, CPAs and enrolled agents who ensure all clients’ returns are prepared and filed on time, regardless of what a client’s filing situation entails.”
Learn more about 1-800Accountant’s tax preparation and filing services by calling 727-350-9655. Or schedule a complimentary one-on-one tax consultation at http://1800accountant.com/1on1/.