Can You Get ACA Tax Credits with Medicare?

Medicare and Medicaid Coverage: No Penalty, No Credits

The Affordable Care Act (ACA) requires most people to have health insurance or pay a penalty. However, certain types of coverage, such as Medicare and Medicaid, are exempt from this mandate. This means that if you have Medicare or Medicaid, you will not have to pay a penalty for not having ACA-compliant health insurance.

However, it’s important to note that even though you won’t have to pay a penalty, you also won’t be eligible for premium tax credits. Premium tax credits are a form of financial assistance that helps people afford health insurance. They are available to people who purchase health insurance through the Health Insurance Marketplace.

ACA Marketplace Coverage: Premium Tax Credits Available

If you purchase health insurance through the Health Insurance Marketplace, you may be eligible for premium tax credits to lower your monthly health insurance premiums. To be eligible, you must meet certain income requirements and have a qualifying life event, such as losing your job or getting married. You can use Form 8962, Premium Tax Credit, to claim the tax credits on your tax return.

1040EZ or 1040A: Which Form to Use?

If you have Medicare or Medicaid coverage, you will not need to file Form 8962. This means that you may be able to use the simpler 1040EZ or 1040A tax forms. However, if you are claiming other tax credits, such as the Earned Income Tax Credit (EIC), you may need to use the more complex 1040 tax form.

EIC and ACA Credits:

Yes, you can claim both the EIC and the ACA premium tax credit if you qualify for both. The EIC is a tax credit for low- and moderate-income working individuals and families. You can use the 1040EZ or 1040A tax forms to claim the EIC.

Conclusion:

If you have Medicare or Medicaid coverage, you will not be eligible for ACA premium tax credits. However, you will not have to pay a penalty for not having ACA-compliant health insurance. If you purchase health insurance through the Health Insurance Marketplace, you may be eligible for premium tax credits to lower your monthly health insurance premiums.

If you need further assistance understanding your health insurance options or tax implications, we recommend speaking with a licensed insurance agent or tax professional.