Tax Tip: Affordable Care Act’s Impact on Tax Season
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Fuse/Thinkstock(NEW YORK) — The Affordable Care Act is bringing the biggest change to the tax code in 20 years.
This year’s tax season marks the first time people will be asked for information regarding their health insurance.
Internal Revenue Service spokesman Eric Smith says for most people, this will be a non-issue. “For more than three out of four taxpayers the change will involve just simply checking a box on your return,” said Smith.
That box indicates people had health coverage, and most likely through their employer.
Others who purchased government-backed health care and received a tax credit to help them pay for it, will have to account for whether they calculated correctly.
Kathy Pickering, executive director of The Tax Institute at H&R Block, says there will either be a payment or a refund.
“When they come in to file their taxes, now they’re reconciling how they estimated their income to what their actual income is,” she said.
The IRS says if someone is considered low-income and not required to file a tax return, they don’t have to buy health coverage. However, those who could afford health insurance and chose not to will receive a fine.
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