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When will TurboTax be updating the forms for the updated tax implications for health insurance on the exchange? Per section 9662, overpayments are not taxable for 2020.

Forum|Forum|5 years ago
March 16, 2021
3 replies
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My income was higher than expected due to strange occurrences due to COVID, so I ended up having a rather large tax burden this year. Per the ARP, I won't have to pay that penalty, for 2020. I'm wanting to know when TurboTax's forms will be updated to show this new rule.

TurboTax Premier Online

Best answer by KathrynG3

TurboTax is depending on the IRS for updates for when, as well. It is very likely the updates will be in place before April 15, 2021. The TurboTax engineers are working as fast as possible to update the software with the changes.

At IRS: Premium Tax Credit: Claiming the Credit and Reconciling Advance Credit Payments

Check Back for Updates to this Page

We’re reviewing the tax provisions of the American Rescue Plan Act of 2021, signed into law on March 11, 2021. Taxpayers who filed a 2020 tax return and reported an excess advance premium tax credit repayment on Line 29 of Form 8962, Premium Tax Credit, should not file an amended tax return only to get a refund of this amount. The IRS will provide more details soon. For the latest updates, check IRS.gov/coronavirus.

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Irene2805

Please see this TurboTax Help article for information: Can I get a health insurance penalty exemption for 2020?

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Beccapooh88Author

But, I'm still getting hit with the penalty. I even deleted the form and re-entered it all. My tax burden went down when I deleted it and went right back up when I input it again. Something's wrong here. It's the exact same amount it's been since I input my tax information back in January, long before the ARP even existed. Suggestions?

ColeenD3

It takes time for the IRS to determine how to structure new laws and it then takes time for software to be written to handle the changes. This is not available yet. The bill was passed 6 days ago.

For the 2020 plan year, the answer is no. This is due to the American Rescue Plan (ARP), which was signed into law by President Biden in March 2021. The ARP provides a one-time relief from excess premium subsidy repayments, but it’s only for the 2020 plan year. It’s challenging to accurately project annual income in a normal year, but the COVID pandemic made it particularly challenging for 2020. To address this, Section 9662 of the ARP clarifies that for 2020 only, people do not have to repay excess premium subsidies. This is true regardless of whether their total household income exceeded 400% of the poverty level, and it’s true regardless of the reason their income ended up being larger than projected.

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Beccapooh88Author

Hence, the question I asked was WHEN would the update be completed on TurboTax's end. I recognize that it was JUST passed and it will take time. I was simply asking the question of "when". Even an estimated time frame would be helpful, i.e. a week, not until AFTER the April 15th deadline, thus requiring and extension request on my part.

ColeenD3

There is no way to know at this point. We are still waiting on the IRS. Since you can still file the extension on April 15, you will have some sort of answer before then.

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9squam1SH4

When will TurboTax update the Tax Forms so the penalty is waived for the 2020 health insurance exchange?

DoninGA

Employee

@9squam1SH4 wrote:

When will TurboTax update the Tax Forms so the penalty is waived for the 2020 health insurance exchange?

As previously stated on this thread "We are still waiting on the IRS".

IRS statement - https://www.irs.gov/affordable-care-act/individuals-and-families/the-premium-tax-credit-the-basics

We’re reviewing the tax provisions of the American Rescue Plan Act of 2021, signed into law on March 11, 2021. Taxpayers who filed a 2020 tax return and reported an excess advance premium tax credit repayment on Line 29 of Form 8962, Premium Tax Credit, should not file an amended tax return only to get a refund of this amount. The IRS will provide more details soon.