Now, I Know Why Our Tax Refund Is Delayed!

I f**ked Up, I Didn't Think I Needed To File Form 8962

Yesterday, we finally found time to get a new mailbox key, after our communal mailbox was damaged, and removed, or stolen, I’m not sure which. I went to check the mail on March 8, 2020, and the mailbox was gone, looking like it had been ripped out of the ground. It was replaced a week later, but I did not have time to get a new key until yesterday, having to work the same hours as the post office is open.

In the avalanche of bills and spam, I found a letter from the IRS, and when I opened it, it told me I had not filed form 8962 with details from our 1095-A, Health Insurance Marketplace Statement. I thought based on what I had read about not having to file 1095’s because proof of insurance was no longer required, due to the individual mandate being repealed. I’m not making excuses, I made a mistake, I didn’t research tax filing requirements, but I’m guessing, I’m not the only one to make this mistake.

I took one look at the 8962 (Premium Tax Credit) tax form on the IRS website and immediately thought, “shit, I don’t know how to fill this out correctly”, so I searched Turbo Tax, where I filed my taxes, and found instructions on how to add the data from my 1095-A, and print out a completed form 8962.

I printed out the completed form 8962, page 2 of my 1040 as the refund amount had changed, made a copy of my 1095-A, and wrote a note about why we had not responded within 20 days of the date of the letter, March 12, 2020, and stuffed it all into an envelope and popped it back in the mailbox.

A side effect of filing form 8962 is a loss of exactly $1,600 from our refund, because we received too much in advanced payments from the Health Insurance Marketplace, having to repay the overpayment. Annoying, but, whatever… at least we do not owe taxes, and we are thankful for the assistance with insurance, as our current premium is $1,300+ and that does not even cover me, as I am not eligible.

I just hope that form 8962 being returned more than 20 days after the date of the letter, will not negatively affect our premium for 2020, which tripled from last year to almost $250, even with the advanced tax credits. My wife has multiple medical issues and without insurance, she is likely to suffer from a fatal condition, she is already at risk from Coronavirus because of a weakened immune system.

Final note, why does the US tax system have to be so complicated? in my home country of the UK, we use PAYE (Pay As You Earn), and should you have a balance or refund at the end of the tax year, you either receive a tax bill or a refund check, but generally, you’ll receive neither as you have paid the correct amount of tax. While in the UK, I received one refund and no tax bills in more than 18 years of working.

The US tax system could work in the same way, the IRS has access to my earnings, tax paid and marketplace insurance information, as the IRS and the Health Insurance Marketplace, are federal programs. Literally, everything is tracked through social security numbers, you are allocated a number, so you can be tracked through your life, so why not use that information to simplify American lives?

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