If you purchase health coverage through the Marketplace, you might be eligible for the Premium Tax Credit (PTC). If you’re eligible, advance payments of this credit can help you pay your health insurance premiums. If you wait to get the premium tax credit when you file your tax return, it may increase your refund. You must file a tax return to claim the PTC.
IRS Form 8962 determines eligibility for PTC or repayment. You must complete this form to claim the PTC and reconcile any advance credit payments with the PTC you are eligible to claim on your return. Taxpayers that receive an IRS Form 1095-A, Health Insurance Marketplace Statement, which you receive from the Health Insurance Marketplace, provides information needed when completing Form 8962. If Form 1095-A was lost, never received, or is incorrect, contact your Marketplace directly for a copy. The IRS does not issue Form 1095-A and cannot provide you with a copy.
The PTC is a refundable tax credit. This means that if the amount of the credit is more than the amount of your tax liability, you will receive the difference as a refund. If you owe no tax, you can get the full amount of the credit as a refund.
If you receive advance payments of the credit, you will subtract those payments from the PTC that you calculate using Form 8962. If the premium tax credit computed is more than the advance credit payments, the difference will increase your refund or lower the amount of tax owed. If the advance credit payments are more than the PTC, the difference will increase the amount of your tax liability and result in either a smaller refund or taxes owed. Filing your return without reconciling your advance payments in this manner will delay your refund and may affect future advance credit payments.
Additional Information:
How is the Premium Tax Credit Calculated?
IRS: Am I Eligible to Claim the Premium Tax Credit?