[fname], did you know that because of the Affordable Care Act, (Obamacare), you tax returns will never be the same?  Most people are still unaware of how Obamacare will affect them personally.

 

In fact, the requirements for minimum essential health insurance coverage and the penalties for non-coverage affect all of us, and as your tax professional, I want to ensure that you have a clear understanding of how these new fees are assessed so you are not surprised by unexpected penalties on your 2014 personal tax returns.

Here is a list of the top ten surprises you could face during tax season because of Obamacare:

1. The Affordable Care Act mandates – and you must report – that you have the minimum essential health care coverage by 2014 or pay a penalty.
 

2. Your spouse and dependents must also have the required minimum essential coverage. If not, you may be subject to a penalty for non-coverage of your spouse and dependents. However, there are 33 separate exemptions from the penalty.
 

3. Your plan must be a “qualified health plan” that meets the standards set by the government. Please check with your insurance carrier.
 

4. If you purchased your insurance through the MarketPlace or an Exchange you will be receiving a form 1095-A in January 2015 which must be used to complete your 2014 personal tax returns.
 

5. If you received a subsidy or credit for your health insurance premium the actual credit must be calculated on your 2014 personal tax return and matched against any advance credit or subsidy you already have taken. The calculation of the 2014 premium credit uses your actual 2014 income. You may receive additional credit or you may be required to repay some or all of the advance credit taken.
 

6. For calculating the final health insurance premium credit total income includes not just your income, (and your spouse’s income), but it may also include your dependent’s income.
 

7. If you are an employer not offering health insurance coverage, and you have 50 or more employees, you may be penalized.
 

8. The law imposes a “net investment income tax, (NIIT), of 3.8% on individuals, estates, and trusts for investment income, interest, dividends, capital gains and rent which you may be liable.
 

9. You may be required to pay an additional 0.9% Medicare Hospital Insurance tax on wages and self- employment income on amounts earned above $250,000 married filing a joint return or $200,000 single.
 

10. Your fee for preparing your personal income tax returns may increase substantially do to the new forms and calculations required by Obamacare.

As you prepare for the upcoming tax season, consider how the Affordable Care Act, Obamacare, will affect your tax return and your potential refund or tax due. I look forward to working with you to answer any questions you may have regarding these items.

 

Also if you have international assets please remember there are also significant reporting requirements regarding ownership or interests in bank accounts outside the United States with severe penalties for failure to report. These new reporting requirements, including a new separate tax return requirement, may also increase your income tax preparation fees.



Please feel free to share this important information with your family, friends, and business associates. I would be happy to discuss these issues with any of your referrals.  If you have any questions please feel free to call me here at the office at 714-619-0667.  Thank you.

Sincerely,

Monica Rebella
 

 

Monica Rebella, CPA/IAR
Rebella
Accountancy
507 E. First Street #A
Tustin,CA 92780
ph (714) 619-0667
Fax (714) 544-0236
email: mrebella@rebellacpa.com



This document was not intended or written to be used, and it cannot be used, for the purpose of avoiding U.S. federal, state or local tax penalties.

 

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