Tax Professionals Step Up to Advise on Health Care

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By Martha W. Kessler

Feb. 18 — One of the unanticipated consequences of the Affordable Care Act is that it has turned tax professionals into health care advisers, particularly for marketplace enrollees.

As a result, the nation's two biggest tax preparers have stepped up their offerings to ensure that filers are aware of their responsibilities under the health care law.

Jim Wadleigh, chief executive officer of Access Health CT (AHCT), Connecticut's marketplace, said he has noticed that the nation's largest tax preparation companies have been doing an increasingly good job of walking taxpayers through the necessary steps related to issues involving the ACA. This is especially important when dealing with taxpayers who don't receive health insurance through their employers, Wadleigh told Bloomberg BNA Feb. 10.

In fact, he said, while trying one national company's product, the software identified him as being from Connecticut and asked if he had received a Form 1095-A, Health Insurance Marketplace Statement, from AHCT. This is an extremely important question because those forms can often get thrown away, he said, when taxpayers don't realize they will need that data.

AHCT said Feb. 18 it has mailed out more than 98,000 Forms 1095-A this season to those enrolled though the Connecticut marketplace.

Face-to-Face Interaction

Lindsey Buchholz, a tax attorney and program manager with the Tax Institute at H&R Block, explained that tax pros have become guides in this area because they are the ones who are having the “face-to-face interaction” with clients for the most part. “So a lot of the educational responsibilities have fallen to the tax industry,” she told Bloomberg BNA Feb. 12.

She said the company's products ask about the Form 1095-A and marketplace enrollment in several ways during the filing procedure in order not to miss a situation, especially one in which filers received advance payment for tax credits related to coverage through the marketplace or in cases where they shared a policy with another taxpayer.

On the penalty side of the equation, H&R Block works to try and find the proper exemption for people who didn't have coverage for the entire year or for everyone in their household. She said it also tries to provide information on how to enroll and what their options are for the upcoming year to avoid penalties.

One question that H&R Block receives repeatedly is from filers who didn't understand that if they were enrolled in a health plan through an exchange for 2014 and didn't actively say, “I don't want to continue my coverage,” that same coverage continued into 2015 until it is ended for lack of payment. Taxpayers who think they didn't have any coverage for 2015 receive a Form 1095-A for one month of the year and are confused.

“So people don't understand that when your policy gets canceled for nonpayment you are responsible for repaying that one month of advance premium tax credit,” Buchholz said.

Shared Allocation

H&R Block also attempts to walk filers through shared allocation, she said. This can happen when parents enroll nondependent children up to age 26 on their health plan. In this situation, the parent should identify the child as his or her own separate tax individual so that the marketplace will generate two separate Forms 1095-A. Otherwise, the taxpayer will need to do an allocation.

Another allocation situation arises when two parents end up claiming the dependent exemption for the same child.

To help identify such situations for filers, the company asks several ways if the filer is claiming someone else on his or her tax return, she said.

Buchholz said the company has also heard anecdotally that some employers are telling workers they should wait until they receive Form 1095-B, Health Coverage, or Form 1095-C, Employer-Provided Health Insurance Offer and Coverage, before filing, information that is clearly incorrect but is spurring questions to the tax preparation companies.

Questions about whether taxpayers need to file Forms 1095-B and 1095-C are also coming into Intuit's TurboTax, which is working hard to make it as easy as possible for taxpayers in this second year that filers are required to report their health insurance status on tax forms.

Entering Info

Lisa Greene-Lewis, a certified public accountant and TurboTax tax specialist with Intuit, said the company focuses on asking taxpayers the proper questions so that filers have to enter the least amount of information possible.

For example, she said, the company is able to determine when filers enter their income from their Forms W-2 if they are eligible for certain exemptions under the ACA without the taxpayer having to do anything else.

Also new this year is the ability of taxpayers to upload their Form 1095-A from a PDF to TurboTax, said Debra Hammer, a senior communications manager for Intuit.

Hammer said the company also continues to monitor and refine the process based on feedback from users.

To contact the reporter on this story: Martha Kessler in Boston at

To contact the editor responsible for this story: Janey Cohen at