When you are insured through the marketplace, Form 8962 is used to calculate the premium tax credit amount you're eligible for. You can reduce your annual tax liability by claiming the premium tax credit.
Who Needs IRS Form 8962?
Only those candidates need to complete IRS form 8962, which has purchased health insurance through the Affordable Care Act’s Health Insurance Marketplace. In case if you're covered by health insurance at your work, you don't need this form for tax filing. Also, if you've purchased health insurance directly from the insurance company, you don't need this form.
File the form 8962 if you
- Want to claim premium tax credits.
- Have paid advanced premium credits covered by your plan.
When you were enrolled for health insurance through ACA, you must have filed a form 1095-A. You will use this Health Insurance Marketplace Statement form to complete Form 8962. This form includes information of
- Premiums paid
- Premium tax credits used
- Information of who is covered under your plan
What Is Form 8962 Used For?
With advanced premium credits, you can reduce your monthly premium payments. Both forms 8962 and 1095- A are used to reconcile the premium tax credit you received and you're eligible to receive. It is decided on the basis of your annual income.
This calculation of differences between amounts matters as it determines your eligibility for receiving money from the IRS. If you've received fewer amounts than the amount you're eligible for, you'll get paid. But if you've received more than the premium tax credit you're eligible to claim, you owe money back to the IRS.
How to Fill Out and Read Form 8962?
Form 8962 consists of two pages and has five parts;
Part 1: you've to record monthly and annual contribution amounts. In this section, you'll make use of information like your family size, modified adjusted gross income, and household income.
Part II: this section includes the reconciliation of your received advanced premium tax credits and monthly premium amounts.
Part III: this section uses your provided information in part II to calculate access premium tax credit payments.
Part IV: you can allocate your policy amounts in this part.
Part V: it is for alternative calculations in the year of marriage
Where to get Form 8962?
This form is free to download from the IRS website. If you're using an electronic tax filing software for filing taxes, you should film a form generated for you.
Can I E-file Form 8962?
The E-filing of forms is a convenient way as it takes less time in completing than paper forms. In case if you're E-filing your taxes, you need to complete the form through the tax filing software program.
How to send Form 8962 to the IRS?
When filling out a paper tax return, you can mail Form 8962 and Form 1040 to the IRS. You also need to mail these forms to the regional office covering your state of residence. There is a helpful table available on the IRS website containing information on where to send Form 1040 and other accompanying forms, such as Form 8962.
