If your clients bought health care coverage through the Health Insurance Marketplace for this year, they may have chosen to have advance payments of the premium tax credit paid directly to the insurance company in order to lower their monthly payments.
It’s important to let the Marketplace know if the taxpayer had any changes that may affect how the tax credit is calculated, since it directly impacts those advance payments.
These changes in circumstances, such as an increase or decrease in income or family size, can indeed make a difference in the total premium tax credit available to your clients. Reporting such changes to the Marketplace will help keep your clients on track with their advance tax credit payments; they won’t get too much nor too little.
Some of the changes in circumstances that should be reported to the Marketplace include:
- An increase or decrease in income;
- Marriage or divorce;
- The birth or adoption of a child;
- Starting a job that has health insurance benefits;
- Gaining or losing eligibility for other health care coverage; or
- Changing residences.