Form 1095 and Filing Your U.S. Individual Income Tax Return. Are you ready?

If you haven’t completed your U.S. Individual Federal Income Tax return yet, you may run up against a question about the Form 1095, why it’s important and whether you can complete your tax return without it.

Form 1095 is a collection of Internal Revenue Service (IRS) tax forms in the United States which are used to determine whether an individual is required to pay the individual shared responsibility provision. Individuals can also use the health insurance information contained in the form/forms to help them fill out their tax returns. The individual forms are Form 1095-A “A Health Insurance Marketplace Statement”, Form 1095-B “Health Coverage”, and Form 1095-C “Employer-Provided Health Insurance Offer and Coverage”. Individuals may receive one or multiple versions of Form 1095.

The Affordable Care Act, or Obamacare, includes both the individual mandate and the employer mandate. The individual mandate requires that most Americans have qualifying healthcare coverage or potentially face a fine.[1] The employer mandate requires employers with 50 or more full-time equivalent employees to offer healthcare coverage to their full-time employees or potentially face a fine. Form 1095 determines whether the employee or the employer have to pay a fine for failing to meet the individual mandate and the employer mandate, respectively.

(the previous two paragraphs came from Wikipedia and described Form 1095 perfectly!)

Normally, Form 1095 is supposed to be delivered by January 31. However, over the past few years, the IRS has granted an extension for health plans and employer groups to deliver it later (presumably due to the onerous effort it may take to get ‘er done). This year the 1095 must be delivered by March 3.  Many employers were planning to deliver the 1095 as soon as possible before March because many people want to file their income tax returns sooner than later, especially if they are due a refund.

The 1095 may be mailed or downloaded from a website.  Your tax accountant or Turbo Tax prompt may ask you to answer a question related to whether you had health insurance in the tax year you’re filing for. The 1095 is meant to illustrate which months you and your tax dependents were covered by said health insurance.  Many people get stuck not completing their tax returns because they don’t have the 1095 in hand.

Good news:  You do not have to wait for either Form 1095-B or 1095-C from your coverage provider or employer to file your individual income tax return. You can use other forms of documentation, in lieu of the Form 1095 information returns to prepare your tax return. Other forms of documentation that would provide proof of your insurance coverage include:

  • insurance cards,
  • explanation of benefits
  • statements from your insurer,
  • W-2 or payroll statements reflecting health insurance deductions,
  • records of advance payments of the premium tax credit and
  • other statements indicating that you, or a member of your family, had health care coverage.

You will not need to send the IRS proof of your health coverage. However, you should keep any documentation with your other tax records. This includes records of your family’s employer-provided coverage, premiums paid, and type of coverage.

To learn more about Form 1095, visit the IRS website.

The information in this post is meant to be informational only, and not intended as legal advice for how to file your individual income tax return.  People who receive their health insurance through the Marketplace or employer or other group plan should check with their insurance provider, employer or group administrator for direction on obtaining their 1095, and also consult with a tax or legal consultant for any direction or advice on properly filling out your U.S. Individual Income Tax Return.

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