Obamacare presentation 2014 v3

M E D I C A L L O S S R AT I O (M L R ) WILL THEY GIVE IT BACK? • ACA REQUIRES 80-85% OF PREMIUMS BE SPENT ON HEALTHCARE SERVICES AND HEALTHCARE QUALITY IMPROVEMENTS • REFUNDED PREMIUMS MAY BE TAXABLE – Refunded premiums reduce the insurance companies’ taxable income – The reduction year and/or an estimated reserve have yet to be addressed – If the taxpayer did not claim a health insurance deduction on their 1040, it is not taxable – If the taxpayer deducted health insurance on their schedule A or as a SEHI, then they must claim the refund as income – It’s unlikely the taxpayer will receive a form 1099-MISC – As a tax preparer, we should ask and report!