Question

Sandra and Debbie have a shared policy. Information on the Form 1095-A must be allocated between their two tax returns. Both of their returns are out of scope.

Answer 1

Answer:

Yes, Sandra can claim Debbie as a qualifying relative on her yearly return as Sandra and Debbie have a shared policy. Information on the Form 1095-A must be allocated between their two tax returns.

Explanation:

When determining the premium tax credit on a tax return, a Shared Policy Allocation should then be reported by each taxpayer on their respective tax returns so that the amounts reported on the Health Insurance Marketplace Statement (Form 1095-A) can be allocated between the individuals on the policy.

A Shared Policy occurs when a qualified health plan has been purchased from the Marketplace or from a state health care exchange and it covers at least one individual on the tax return and at least one individual not on the tax return under several scenarios as the one with Sandra claiming Debbie or viceversa , in their Shared Policy, they, as taxpayers, will need to allocate the three amounts reported on Form 1095-A (enrollment premiums, SLCSP premiums, and/or APTC) between the taxpayer's tax return and the tax return of the other individual(s) who is not on this tax return and is filing their own return. This is known as a Shared Policy Allocation.

Sandra and Debbie have a shared policy. Sandra got the 1095-A Form for she and Debbie´s covereage individuals for the year, therefore, Sandra can claim Debbie as a qualifying relative on her yearly tax return because Debbie lived with Sandra as a member of her household, unless Debbie has had gross income of more than $4,200 during the tax year.

Both Sandra and Debbie can claim the entire amount of the premium tax credit since both of their names are shown on Form 1095-A as covered individuals, but Sandra should reconcile the entire premium tax credit information from her Form 1095-A on her tax return, or Debbie should reconcile the entire premium tax credit information from Sandra's Form 1095-A on her tax return. Sandra and Debbie have a shared policy. Information on the Form 1095-A must be allocated between their two tax returns.