Anyone's tax software correctly dealing with ACA tax credits yet?

[Fermion]

I am doing our taxes and using H&R Block software and even after updating it is putting in $10,500 owed for repayment of advance premium tax credit on our ACA policy.

I am not sure how to make it subtract that out. I am assuming they have just not updated the software yet to delete the repayment requirement for 2020 (special case of the relief law signed March 11).

I guess the right thing to do is wait to file? I had made enough estimated tax payments to cover this so would be getting a quite large refund if the software removes the $10,500 figure. Are any of the other software packages working correctly on this yet?

 

[SecondCor521]

The latest I have heard is that the IRS has not determined how to address this tax law change yet. The IRS needs to announce how they're going to handle it before the tax software folks can implement the changes. So I think that the tax software folks are in a holding pattern at the moment.

The IRS probably prefers that you wait, but it's up to you to decide whether to do so or not, based on the totality of your tax situation. You certainly *can* file now if you want to. The IRS clearly will have to make appropriate accommodations for people in your shoes, but whether this takes the form of an automatic refund or an amended return is still TBD.

 

[FANOFJESUS]

From what I read it will be after April 1st

 

[ncbill]

Check the "Health insurance through an employer" box instead until the software is updated?

 

[Fermion]

Check the "Health insurance through an employer" box instead until the software is updated?

I mean, is it ok to file like that? Do we know 100% sure that the IRS does not require you to use the form 1095 or whatever it was for marketplace insurance?

 

[SecondCor521]

I mean, is it ok to file like that? Do we know 100% sure that the IRS does not require you to use the form 1095 or whatever it was for marketplace insurance?

It is not OK. It's never a good idea to lie on a tax form in order to "make the numbers work".

If you did check that box, then you'd probably make the problem worse, because you then probably would not be entitled to any premium tax credit, and your repayment amount would probably be greater than the $10,500 number - it would be the total of all of your APTC (so whatever was on your Form 1095-A line 33C).

And yes, the IRS requires you to enter the information from Form 1095-A on your tax return (it'll end up on Form 8962). It is not optional, and since the 1095-A information is sent from your health insurance company to the IRS and they have computer matching, you'll probably get an unpleasant letter from the IRS at some point if you try omitting the information.

...

As I previously mentioned, the IRS has not yet determined how taxpayers should properly address this new provision in the law.

Your good choices include (a) waiting for the IRS to announce how to handle it (should be Real Soon Now), or (b) filing with the APTC repayment on there as it is now and then amending your return or receiving your automatic refund once the IRS addresses the topic.

 

[karen1972]

Following this as I can't get a straight answer and just get referred back to the unemployment change which is very frustrating as that is not my issue.

I realized this changes not just my refund this year but also what my estimated tax calculation for next year will be, would be nice not to have to cut that bigger check.

 

[4legsgood]

This looks like a likely place to see when IRS has updated instructions:

https://www.irs.gov/affordable-care-act/individuals-and-families/the-premium-tax-credit-the-basics

"Check Back for Updates to this Page
We’re reviewing the tax provisions of the American Rescue Plan Act of 2021, signed into law on March 11, 2021. Taxpayers who filed a 2020 tax return and reported an excess advance premium tax credit repayment on Line 29 of Form 8962, Premium Tax Credit, should not file an amended tax return only to get a refund of this amount. The IRS will provide more details soon. For the latest updates, check IRS.gov/coronavirus."

 

[caprica]

Just this morning I opened Turbotax (I have Premiere, Desktop version) and it updated automatically, and FINALLY has the UI fix. The $10200 was deducted from my total unemployment income, and this can be seen on on line 8 of schedule 1. Hooray! Apparently the online version was fixed a few days earlier.

 

[SecondCor521]

Just this morning I opened Turbotax (I have Premiere, Desktop version) and it updated automatically, and FINALLY has the UI fix. The $10200 was deducted from my total unemployment income, and this can be seen on on line 8 of schedule 1. Hooray! Apparently the online version was fixed a few days earlier.

Nice.

Two things:

First, this thread is mostly about the APTC repayment issue, which is a different issue from the unemployment income issue you're referring to.

Second, the states may or may not treat the $10,200 as taxable at the state level. My state has chosen to continue to treat it as taxable, so for residents of my state they must add it back on their state return.

Check with your state taxing authority to see how to handle both the UI and the APTC repayment.

 

[Fermion]

My H&R Block tax software just updated and still no change to the ACA subsidy repayment for tax year 2020.

 

[COHgirl]

TurboTax had an update when I opened it today. Sadly it wasn’t for the ACA correction. Maybe next time.

 

[chumped]

Credit Karma is updated. Totally free Fed and State. Have used for last three years.

 

[cathy63]

Credit Karma is updated. Totally free Fed and State. Have used for last three years.

How did they update their software to handle the APTC change? The IRS hasn't made any announcement about how to implement it yet, so I assume they just decided to force zeroes onto lines 28 and 29 of form 8962 so that the e-files would still go through. I wonder what's going to happen to those returns if the IRS eventually says they're modifying Schedule 2 and want everyone to use that instead.

 

[SecondCor521]

How did they update their software to handle the APTC change? The IRS hasn't made any announcement about how to implement it yet, so I assume they just decided to force zeroes onto lines 28 and 29 of form 8962 so that the e-files would still go through. I wonder what's going to happen to those returns if the IRS eventually says they're modifying Schedule 2 and want everyone to use that instead.

I just did a test return in Credit Karma. They don't do anything about the APTC repayment and basically ignore ARPA. There are non-zero entries on lines 28 and 29 of Form 8962. (I'm not surprised.)

 

[chumped]

My bad. Was confused with the unemployment adjustment.

 

[Fermion]

Just updated my H&R block deluxe tax software this morning and presto! refund went up by $11,000!

 

[COHgirl]

Turbo Tax has been updated!! Yay!! We’re getting a refund!! :::happy dance::::

 

[GLM]

My TurboTax updated as well so we get a small refund versus paying a whole bunch.

Be careful though - when I look at the details it acted as if we had paid the entire ACA premium ourselves and had high medical expenses. (DH is self employed part time) I noticed this when comparing our data to national averages provided down on the list of forms while in the form format.

However, we still did not exceed the standard deduction so the results are fine for us.

 

[Katsmeow]

Does anyone know how the online tax filing software handles this? My kids file using online (probably Turbo Tax but maybe H&R Block).

They have been holding off filing because of this whole ACA repayment of advance tax credits thing. If none of that has to be paid back then they will apparently both get good refunds. They are eager to file to get their refunds but don't want to file until the online software handles the new law.

Does anyone know if it is now up to date for those using the online software? They have simple returns and use the free version.

 

[cathy63]

Does anyone know how the online tax filing software handles this? My kids file using online (probably Turbo Tax but maybe H&R Block).

They have been holding off filing because of this whole ACA repayment of advance tax credits thing. If none of that has to be paid back then they will apparently both get good refunds. They are eager to file to get their refunds but don't want to file until the online software handles the new law.

Does anyone know if it is now up to date for those using the online software? They have simple returns and use the free version.

Yes, TurboTax is updated. It still fills out form 8962 and calculates the repayment amount, but it does not put that amount on Schedule 2 Line 2. So it always acts as if the repayment amount is $0.

 

[karen1972]

Someone on Turbo Tax community reported their taxes were rejected with:

"updates to the Self Employment Health and Long term care insurance deduction worksheet are estimated to be completed by 4/30/2021"

 

[foxfirev5]

Peanut gallery here. My two rules with taxes are to always owe them and file paper returns.

 

[CardsFan]

I agree with the first rule. But why paper file? E-file is quicker, easier, and acceptance is known in hours.

Peanut gallery here. My two rules with taxes are to always owe them and file paper returns.

 

[cathy63]

Someone on Turbo Tax community reported their taxes were rejected with:

"updates to the Self Employment Health and Long term care insurance deduction worksheet are estimated to be completed by 4/30/2021"

Ours was accepted, but we just have the regular premium tax repayment that was waived for 2020, no self employment or long term care insurance.