Marie Posted February 23, 2015 Report Posted February 23, 2015 Client went on the marketplace, got insurance and a subsidy. Her husband is disabled and receives social security. I'm almost sure that no one told her she had to add in his SS to their income to get a household income figure. Well, now they owe over $2000 for repayment. If she does not want to repay, what are the repercussions? They are not receiving a refund- never do, she runs the family farm and does not pay estimates. I understood that no liens could be put on, and really nothing forcible to get the subsidy back. Is that right? If she gets a USDA payment of some sort, would that amount be held out of the USDA payment? Quote
Terry D EA Posted February 23, 2015 Report Posted February 23, 2015 Check your calculations. Only the taxable portion of SS is used to add to the household income. Any repayment would be taken from a possible refund or result in a tax due. They can't refuse to pay. That would be the same as refusing to pay a tax due and the IRS will indeed do everything possible to them to collect the balance due. 1 Quote
Terry D EA Posted February 23, 2015 Report Posted February 23, 2015 See if this will help you. This is a post that I believe was started by JKLCPA regarding penalty relief due to the repayment of any subsidy. However, your client should have received form 1095A to get this relief. '?do=embed' frameborder='0' data-embedContent>> Quote
jklcpa Posted February 23, 2015 Report Posted February 23, 2015 Check your calculations. Only the taxable portion of SS is used to add to the household income. Any repayment would be taken from a possible refund or result in a tax due. They can't refuse to pay. That would be the same as refusing to pay a tax due and the IRS will indeed do everything possible to them to collect the balance due. This isn't correct. For the PTC (subsidy) the amount used in the calculation is MAGI and includes AGI, t/e interest, foreign earned income exclusion from form 2555, and the non-taxable portion of SS added back. The definition and calculation of MAGI that is used for form 8965 for the shared responsibility payment (the penalty) is different. Quote
Marie Posted February 23, 2015 Author Report Posted February 23, 2015 I THOUGHT THE MAGI WAS THE SAME FOR THE SUBSIDY AMOUNT AND THE PENALTY. WHAT IS THE DIFFERENCE? Quote
Terry D EA Posted February 24, 2015 Report Posted February 24, 2015 This isn't correct. For the PTC (subsidy) the amount used in the calculation is MAGI and includes AGI, t/e interest, foreign earned income exclusion from form 2555, and the non-taxable portion of SS added back. The definition and calculation of MAGI that is used for form 8965 for the shared responsibility payment (the penalty) is different. Judy, thank for pointing this out. you are correct and I was thinking of the penalty exemption and not the PTC. Accept my apologies please. Quote
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