If a taxpayer is enrolled in a policy with a person not in the taxpayer’s tax family (a shared policy), the taxpayer may have to allocate the items on Form 1095-A (the enrollment premium, the premium for the applicable SLCSP, and the advance credit payments) with another taxpayer. This is what’s called a Shared Policy Allocation.
The following taxpayers may have to do a shared policy allocation:
- Taxpayers who got divorced or legally separated in 2014
- A taxpayer who claims a personal exemption deduction for an individual enrolled in a policy by another taxpayer
- A taxpayer who enrolls an individual in a policy, but another taxpayer claims a personal exemption deduction for the individual
- A taxpayer filing a separate return from his or her spouse
The taxpayer and former spouse can allocate these amounts in any proportion agreed upon, but the allocation of all amounts must be in the same proportion. If the taxpayer and former spouse cannot agree on a proportion, the taxpayer and former spouse must allocate these amounts at a value of 50%.
The Shared Policy Allocation is entered on Form 8962, Part 4.
What if taxpayers get married during the year?
If taxpayers got married during the tax year and one or both spouses received advance premium tax credit payments for the year, the spouses may be eligible to use an alternative calculation to determine their excess advance credit payments. See the instructions for Form 8962 for eligibility. If eligible, taxpayers will complete Form 8962, Part 5, Alternative Calculation of Year of Marriage.
Source: Internal Revenue Service