REPOST: Tax returns to change with Affordable Care Act

Filing tax returns can be a tough and tedious task, and with the Affordable Care Act added in the picture, there could be even more confusion. Read the article below to know more about these changes.

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Filing tax returns will be different this year due to the onset of the Affordable Care Act, officials from the U.S. Department of Health and Human Services announced Thursday.

Tax filers who had health insurance in 2014 through work or an unsubsidized policy will check a box on their tax returns indicating they had coverage, said Treasury Secretary Jacob Lew.

But those who did not have health insurance or received a subsidy will be required to go further, Lew said in a news release from DHHS. “A fraction of taxpayers will take different steps, like claiming an exemption if they could not afford insurance or ensuring they received the correct amount of financial assistance,” he said. “A smaller fraction of taxpayers will pay a fee if they made a choice to not obtain coverage they could afford.”

Those with Marketplace coverage will receive a 1095-A form that will be used “to reconcile their upfront financial assistance,” the news release said. Over the next few weeks, government agencies will release various “consumer-friendly tools and resources” for tax payers who have health coverage through the Marketplaces, those seeking an exemption and those looking for information about the fee for those who could afford to purchase health coverage but chose not to, the news release said.

Some resources can already be found at www.IRS.gov/ACA, or www.healthcare.gov/taxes/.

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In addition, the government also will contact Marketplace enrollees directly through email, phone and text messages, the news release said.

“We will focus on providing targeted messaging to consumers who benefitted from an advanced premium tax credit last year to help them offset the cost of their Marketplace premiums,” the news release said.

The department also will work with community organizations and non-profits to provide assistance and resources and will form partnerships with top tax preparers to provide consumers with information.

Wall and Associates Inc helps businesses and individuals find solutions for settling outstanding taxes. For more information about filing tax returns, visit this blog.

Making tax debt payments more manageable

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What does a person upon the discovery of actually owing more income tax than he or she can immediately pay? Similarly, what options are available to a person who has accumulated a significant amount in back taxes?

Suddenly finding out issues in tax payments can take the wind out of anyone, especially if it adds to one’s financial burdens. It can be challenging enough to make ends meet during difficult times. Having problems with the IRS can lead to further financial complications that are best avoided.

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Fortunately, the IRS understands that income tax and back taxes can be a severe burden on taxpayers, which is why it instituted a program to allow for payments in monthly installments rather than a punitive lump sum.

To apply for an installment agreement, the taxpayer must submit the IRS Form 9465. If the total debt is less than $25,000 in taxes, penalties, and interest, the taxpayer can then complete an online payment agreement instead. Otherwise, he or she must submit a Form 433-F along with the Form 9465. The IRS will usually respond to the application within 30 days.

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Once granted, the taxpayer will get the time needed to pay the tax liabilities. As long as the terms of the agreement are honored and the taxpayer makes the payments on time, then any collection efforts by the IRS or other collection agencies will stop. However, it is also important to remember that the IRS will still apply interest and penalties to the unpaid balance until it is fully paid.

Wall and Associates Inc. helps taxpayers find solutions to many IRS tax problems. To find more information on tax payments issues, visit this website.