Categorized | Banksters

Those with Obamacare subsidies may owe money when tax time comes

tax-bill

Obamacare is a confused muddle that seems a gift to insurance companies who, as you may have noticed, supported it. Those who have Obamacare subsidies may receive nasty jolts come tax time in 2015, especially if their income fluctuates, as they could owe additional money. Obamcare rates are based on monthly income. If your income goes up for a few months, then drops back down, your subsidy for those months could be disallowed and thus you’ll have to pay the difference.

Obamacare is curiously overcomplicated. Why is that? And who benefits from it? You might even have to make a repayment even if your income doesn’t fluctuate, suggests one study.

If a person’s income fluctuates, which happens more frequently than many realize, the subsidy amount will change from month to month. Thus, when it comes time to file taxes in April, the amount of subsidy received over the past year must be reconciled with the final calculation of the total subsidy for which the individual was eligible—based on actual income for the entire tax year.

If subsidized Obamacare exchange enrollees don’t report any changes in their income throughout the year, they could be on the hook for potentially expensive repayments come tax time.

  • Kevin

    There are caps on the repayment amount for those with income less than 400% FPL.

    • http://polizeros.com/ Bob Morris

      Good. The govt needs to make sure people know about the possibility of repayment to avoid negative PR.

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