2015 Covered California Tax Credit Warning

Many people elected to authorize Covered California to automatically access their federal tax return information and process re-enrollment for next year.  According to the Sacramento Bee, those who did, may face a problem with their tax credit.

As plans are added or changed on the exchange, subsidy rates can change.  However, we’ve read that subsidy rates may not automatically re-calculate for those who automatically re-enroll.  This means that the 2014 subsidy amount could be applied to 2015 and that amount may be inaccurate.  People could end up owing subsidy amounts back to the federal government; or could be due a larger subsidy.

The fact is, the subsidy amount won’t be reconciled until the 2015 taxes are filed.  By then, people may find out that they owe for overpaid subsidies and possible penalties.

What to do?  Make sure you re-enroll and adjust your income as necessary.  Don’t assume that because you’ve automatically re-enrolled, the subsidy is correct for another year.  Call Covered California for details on how to complete the 2015 enrollment.  Covered California:  (800) 300-1506

 

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September 3rd, 2014 by RealCare Insurance Marketing, Inc.