The CPA Enrichment Act of 2010

 

 

The Patient Protection and Affordable Care Act (PPACA) requires most Americans to have health insurance.  This is the Individual Mandate.  Failing to purchase coverage without a good excuse will cost you a fine, the Shared Responsibility Payment.  How will the federal government assess that fee?  Your annual income tax return! 

The PPACA also provides tax credit subsidies to help Americans earning less than 400% of the Federal Poverty Level pay their premiums if the policy is purchased through a state or federal insurance exchange.  The final calculations are supposed to be recorded on your tax return. 

Our friends in Washington are trying to create the form to record your compliance with the new law.  As a patriotic American, I thought that I might be able to help.  Below is a Schedule I (Insurance) Form. 

 

                                Health Insurance Compliance    

                             

Section I

(Form 1040)                                                                             2014

 

Name as shown on Form 1040, Line 6a____________________________ 

Social Security Number____-__-____ 

Name of Individual, Spouse, or Dependent ____________________________ 

One Schedule I per person. 

This form will determine whether or not you had qualified health insurance for 2014.  Complete a separate Schedule I for each person listed on Form 1040, Lines 6a through 6c. 

A. Insurance

            1. Did the above named individual have comprehensive major medical

                coverage through an Employer sponsored group health policy for all

                of 2014?

                        ___ YES    Return to Form 1040, Line 29 and check YES

                        ___  NO     Continue

            2. Did the above named individual have a qualified individual health

                policy for all of 2014?

                        ___ YES    Not purchased through a state or federal exchange

                        ___ YES    Grandfathered policy (purchased prior to March

                                           2010)

                        ___ YES    Grandmothered policy (purchased March 2010

                                           to December 31, 2013)

                If YES, Return to Form 1040, Line 29 and check YES

                        ___ YES    Purchased through a state or federal exchange.  

                                           Proceed to Section B

                        ___  NO     Continue

            3. Did the above named individual have a qualified health policy

                during 2014?

                        ___ 9 – 12 months   Return to Form 1040, Line 29 check YES

                        ___ 0 – 9 months     Continue

            4. Was the above named individual granted a Hardship Exemption?

                        ___ YES    Return to Form 1040, Line 29 and check YES

                        ___  NO     Return to Form 1040, Line 29 and check NO.

   The Shared Responsibility Payment is computed on Form 1040, Line 65

 

B. Tax Credit Subsidy

The above named individual purchased health insurance through a state or federal exchange.

            1. Was an employer sponsored group health policy available through

                 personal employment, a spouse, or parent?

                        ___ YES    Return to Form 1040, Line 29 check YES, Line 29a

                                          check NO

                        ___  NO     Continue

            2. Was the above named individual incarcerated during 2014?

                        ___ YES    Return to Form 1040, Line 29 check YES, Line 29a

                                          check NO

                        ___  NO     Continue

            3. Insert income from Form 1040, Line 23 ___________________

            4. Determine tax credit subsidy from Table I.

            5. Did the above named individual qualify for a tax credit subsidy?

                        ___ YES    Return to Form 1040, Line 29 check YES, Line 29a

                                          check YES

                                          Enter earned subsidy here _____________ and

                                          on Form 1040, Line 65a.

                        ___  NO     Continue

            6. Does the above name person want to dance?

                        ___ YES    Under the moonlight

                        ___  NO     Don’t ask me

            7. Did the above named individual receive a tax credit subsidy?

                        ___ YES    Return to Form 1040, Line 29 check YES, Line 29a

                                          check NO and enter subsidy received on Form 1040,

                                           Line 65b

                        ___  NO     Return to Form 1040, Line 29 check YES, Line 29a

                                          check NO and leave Form 1040, Line 65b blank. 

 

The above is my initial stab at this.  The Internal Revenue Service may, or may not, be even this far along in the process.  CPA’s are gearing up for forms that may not be available until mid or late February.  Tax preparation software will be updated, and updated again before April 15^th. 

My advice is to make friends with an accountant.  You’re going to need one.

 

DAVE

 

www.bcandb.com