What are 1095 Tax Forms for Health Care?
The Affordable Health Care Act introduced three new tax forms relevant to individuals, employers and health insurance providers. They are forms 1095-A, 1095-B and 1095-C. These forms help determine if your health insurance plan meets the requirements of the Act. For individuals who bought insurance through the health care marketplace, this information will help to determine whether you are able to receive an additional premium tax credit or have to pay some back.
Key Takeaways
- 1095 tax forms help individuals and the IRS verify and complete tax returns related to healthcare coverage and penalties.
- Failure to have insurance coverage for at least three months or more can require an individual shared responsibility payment for tax years from 2014-2018.
- Affordable coverage exemptions may be offered if an employer does not provide affordable options or the gap in insurance coverage is three or fewer consecutive months.
- Form 1095-A provides information on health insurance purchased on the marketplace, including coverage amount, tax credits, and amount paid for coverage, while Form 1095-B verifies if an individual and dependents have MEC, type of coverage, dependents covered, and period of coverage.
Shared responsibility payment (for tax years prior to 2019)
For tax years beginning with 2014 and ending with 2018, any gap in qualifying insurance coverage of three months or more for you or your dependents can require you to pay an individual shared responsibility payment. This information is reported on your income tax return and is obtained from the information you provide and that provided on 1095 forms. You may be exempt from this payment if, for example:
• affordable coverage options are not offered by your employer.
• The gap in insurance coverage is three or fewer consecutive months.
• You belong to a group that is explicitly exempt from participating in the Affordable Care Act by the Internal Revenue Service (IRS).
Check out "Are You Exempt From Health Care Coverage?" for a complete list of exemptions.
Form 1095-A
Insurance companies participating in health care exchanges should provide you with the 1095-A form, a health insurance marketplace statement. This form includes:
- your name
- the amount of coverage you have
- any tax credits you were entitled to
- if you used them to pay for your health insurance and the amount you paid for coverage
You use this information to complete your income tax filing, adjust any tax credit payments and claim any premium tax credits that may be due.
TurboTax Tip:
Employers with 50+ full-time employees use Form 1095-C to show coverage offered and whether or not an employee chose to participate.
Form 1095-B
Employers with fewer than 50 full-time employees that offer health coverage, as well as health care insurance providers, send the 1095-B form to members of their health insurance plans. This form includes:
- the type of coverage you have
- your dependents covered
- the period of the coverage
This form is used to verify on your tax return that you and your dependents have at least Minimum Essential Coverage (MEC). If you had a break in health care coverage for the tax year, you may have to pay an individual shared responsibility payment.
Form 1095-C
Form 1095-C, employer-provided health insurance offer and coverage, shows the coverage that is offered to you by your employer.
It is used by larger companies with 50 or more full-time or full-time equivalent employees. This form provides information of the coverage your employer offered and whether or not you chose to participate. You can use this to complete your tax return.
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