HCTC-Eligible Taxpayers Without Qualifying Coverage Get Hardship Exemption (Notice)

CCH Tax Day Report

The Department of Health and Human Services (HHS) has provided a hardship exemption for individuals who qualify for the Health Coverage Tax Credit (HCTC) under Code Sec. 35, but who were not enrolled in HCTC-qualifying health insurance coverage. This hardship exemption applies only for certain months in 2016.

An individual who was not enrolled in HCTC-qualifying health insurance coverage for one or more months between July and December 2016, but would have been eligible for the HCTC if enrolled, will be entitled to a hardship exemption from the individual shared responsibility provision for the months the individual was HCTC eligible. The hardship exemption extends to all eligible individuals and/or qualifying family members who were not enrolled in HCTC-qualifying health insurance coverage for one or more months between July and December 2016, but were HCTC eligible. The IRS intends to publish guidance allowing individuals who are eligible for this exemption to claim it on their 2016 tax returns.

Guidance on Health Coverage Tax Credit Hardship Exemption, 2016FED ¶46,389

Other References:

Code Sec. 35

CCH Reference – 2016FED ¶4175.30

Code Sec. 5000A

CCH Reference – 2016FED ¶34,963.15

Tax Research Consultant

CCH Reference – TRC HEALTH: 3,102

CCH Reference – TRC HEALTH: 15,154

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CCHTaxGroup

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