Skip to main content

Advanced Search

Advanced Search

Current Filters

Filter your query

Publication Types



Newsletter Article


Health Law Subsidy Recipients with Bad Information Won't Owe More Taxes

By Rebecca Adams, CQ Roll Call

February 25, 2015 -- About 50,000 tax filers, who received incorrect information about subsidies they received under the health law and already filed their 2014 returns, won’t have to pay any sums they owe as a result of the government's mistake.

Centers for Medicare and Medicaid Services officials announced last week that about 800,000 tax filers, which could be more than 1 million individuals, got incorrect tax statements. Principal Deputy Administrator Andy Slavitt said some of those people may have gotten tax refunds that were too big, while others didn't receive all they were owed.

A Treasury Department spokesperson said Tuesday that people who have filed do not need to amend their returns. “The IRS will not pursue the collection of any additional taxes from these individuals based on updated information in the corrected forms,” said the spokesperson.

The remaining people affected, who have not yet filed their returns, should wait until they get corrected forms as early as next week.

But Treasury officials are encouraging people who have filed already to check if their refunds should have been bigger and re-file their taxes if need to recoup the difference. If the taxpayer sees that the monthly premium for the local benchmark plan on the original form is less than the premium listed on the corrected form, it may be worth refiling.

“Individuals may want to consult with their tax preparers to determine if they would benefit from filing amended returns,” said the spokesperson.  

The tax problem is separate from longstanding concerns about whether some consumers underestimate how much they would earn and took subsidy credits last year that were too generous. If someone claimed too much of a credit to discount the price of their insurance premium, that person will have to pay it back.

H&R Block Inc. estimated in an analysis Tuesday that about 52 percent of people who enrolled in private health insurance through marketplaces last year are learning that they got subsidies that were too high and have to pay them back. People have had to return an average of about $530, which decreased their tax refund by about 17 percent, the company said. On the flip side, about 33 percent of marketplace customers overestimated their income and are getting bigger refunds than they expected, with the average amount totaling $365 on average, an approximately 11 percent boost. 

Rebecca Adams can be reached at [email protected]

Publication Details