What is IRS Form 8965? & How to Fill it Out?

IRS Form 8965

Being a U.S. taxpayer you must have come across a lot of different tax forms. Some of them are very simple forms while some others are a little bit difficult. The IRS Form 8965 is a tax form that needs a great amount of attention as it is relatively difficult. Now you must have started having a lot of questions about this form. These questions can be like:

  • What is IRS form 8965
  • How to fill out IRS form 8965
  • Where do you mail IRS form 8965?

You do not have to worry as here we are going to answer all the questions related to this form and we will also explain important IRS form 8965 instructions.

A Detailed Overview:

This tax form helps you to report the exemption from owing a tax payment for not having health insurance during the year. It might seem a little bit difficult at first but it is actually not. The process of filing is very easy. All you have to do is enter a few basic details. And once completed you can attack this tax form with the annual tax return. This is how you report your health insurance exemption from owing a tax payment.

A taxpayer needs to fill out the IRS Form 8965 if he/she qualifies for a health coverage exemption. If any family member of the taxpayer qualifies for the same then also they need to fill out this tax form. For filling out this form your income has to be above the tax return filing requirements. If it is not then there is no requirement of filing a tax return and filing this form. And you are also automatically exempt from the shared responsibility payment. 

But if you still want to file a tax return then you will also have to claim the coverage exemption. And for that, you will have to fill out this form. But in this case, you should be exempt from making the payment. The reason for this is your income is not above the filing requirements. There is no need to attach form 8965 with the tax return if you are already granted and approved for an exemption through your health insurance Marketplace. Otherwise, it is required if you want to qualify for the exemption. 

You May Also Read: IRS Form 8283?

Coverage Exemption:

If you are already granted an exemption then it simply means you are exempt from the individual mandate. According to this law, you must have health insurance. When you are exempted, you will not have to pay for the month you do not have insurance. 

Generally, you can claim a coverage exemption with this tax form attaching it to your tax return. In a few specific cases, you will have to fill out an application and then mail it to the Health Insurance Marketplace. There it can be reviewed. If it gets approved you will get an exemption.

  • Income-related exemptions: You can guarantee an exception if your pay is beneath the assessment documenting edge. Likewise, if the most minimal evaluated inclusion accessible to you, either through the commercial center or occupation-based arrangement would cost over 8.16% of your family pay, you can guarantee a moderateness exception utilizing Form 8965. 
  • Health coverage-related exemptions: On the off chance that you were just uninsured for one to two months, you may fit the bill for the short hole exception. You may likewise be excluded in the event that you live in a state without an extended Medicaid program, and your family unit pay is 138% underneath the government destitution level. 
  • Group membership exemptions: You can guarantee a Form 8965 exclusion for participation in specific gatherings including a governmentally perceived clan (or are qualified for administrations through an Indian Health Service Provider), a perceived medical services sharing service, or an individual from cognized strict order with strict issues with protection, including Social Security and Medicare (application required).

Exemptions You Can Claim:

There is a list of all the exemptions that you can claim using the IRS Form 8965:

  • Unaffordable coverage
  • Short coverage gap
  • Income below the filing requirement
  • A citizen who lives abroad or a noncitizen
  • Lives in a state that did not expand Medicaid
  • A member of a healthcare sharing ministry
  • Or being a member of an Indian tribe
  • Being incarcerated

Exemptions That You Cannot Claim:

Though you can report most healthcare exemptions on Form 8965, you must apply for the following exemptions via the Marketplace: 

  • If you are a member of a religious sect
  • You came across a difficult situation and could not obtain health coverage. 
  • There was no affordable health coverage available. 
  • You were not eligible for Medicaid in a state that did not expand Medicaid coverage
  • If you got a notification from your health insurance provider that your policy could not get renewed. 
  • If you have short-term coverage or self-funded insurance. 

You May Also Read About: IRS Form 2553?

Reporting Healthcare Exemptions:

You can claim your health insurance exemption with this tax form and then attach this to your annual tax return. You only need to submit one form. This form needs to have all the exemptions even if it is just a one-month exemption during the year. Although you will not have to pay any taxes for that month.

Wrapping Up!

By now you must have got an idea what is the process to fill out the IRS Form 8965 and furthermore how troublesome it is. So it is significant for you to comprehend when you need to fill out this form. On the off chance that you have chosen to oversee everything all alone, at that point it is more significant. All things considered, staying aware of the apparent multitude of cutoff times can turn somewhat however hard for you. This is the reason the greater part of the individuals is considering recruiting a duty proficient nowadays. If you have somebody to take care of all your tax-related things and fill out tax forms, there can not be a better thing than that. 

At this point, you must be thinking about how to start. You can visit our site Accounts Confidant or give us a call on +1-866-301-2307 If you have any questions related to this.

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