Subsidy Eligibility Debate

[Ann H]

Does the group allow any employee to say anyone off the street is their live-in soon to be wife and enroll them on the company healthplan, without proof?

If so, she is eligible for employer sponsored coverage, and therefore, not subsidy eligible. I'll eat an entire broccoli if this is the case-I've never even heard of any company letting any employee enroll anyone they want without proof.

If not (proof of DP status is required) than she is NOT explicitly eligible, and therefore IS subsidy eligible. Nowhere in any law does it compel anyone to prove DP status.

Further, since they are unmarried, they could not file a joint tax return. Any subsidy calculation would only take into account her income/deductions and a household size of 1 (unless she has a dependent).

I'm confident to say, she is subsidy eligible. She loses eligibility when they get married.

For the record, I like Broccoli. You are correct about the proof of Domestic Partner relationship on group plans! It can be a tough form you have to fill out to prove the relationship. Questions like, do you own an asset together like a home or vehicle, or a bank account... How long have you been together, and do you comingle funds... So, it is often not easy to qualify as a DP for a group plan. Some states and some group plans might be easy - I don't really know. KGMom said TX doesn't require proof. But in AZ (and apparently in NY where RayNY lives), it is kind of difficult to prove DP relationship for eligibility for insurance.

No broccoli for you. You are right about the DP documentation issue in your state and mine.

The deal about this case, according to Somarco, is that the employee already went down the DP route, got a quote for the premium, choked on the cost, and then diverted to wanting IFP with hopes of a subsidy. So, apparently the client is eligible for the group plan. Now, if only Yagents would dazzle us with his brilliance and tell us if that means she is NOT eligible for a subsidy, or if that means she is like the "under age 26" kid in his other case where hc.gov says he can get a subsidy.

While we are waiting for YAgents, perhaps a hc.gov rep will know. hehehe

 

[Yagents]

Let the 1040 guide you.

Can they legally file taxes jointly? NO. Subsidy eligible

With separate tax filings, how will any gov't entity know that the person is eligible for group? They can't. Subsidy eligible.

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Here is the info on under age 26. Similar logic.

https://www.healthcare.gov/young-adu...dren-under-26/

If a child under 26 can be covered under a parent's policy, can they get lower costs on Marketplace insurance based on income if they apply themselves?

It depends on whether the child is a dependent in the parent's tax household.

If the under-26 child is included is a dependent in the parent's tax household, - and if they have access to a parent's job-based coverage – they aren't eligible for lower costs on a Marketplace plan. This is because they have access to job-based coverage.

If the child files taxes themselves, they may be eligible for lower costs on a Marketplace plan based on their income. This is true even if they have access to a parent's job-based coverage. But if the child is enrolled in a parent's job-based coverage, they aren't eligible for lower costs on a Marketplace plan.

 

[somarco]

Let the 1040 guide you.

Can they legally file taxes jointly? NO. Subsidy eligible

With separate tax filings, how will any gov't entity know that the person is eligible for group? They can't. Subsidy eligible.

So if they CAN file jointly, no subsidy. But if they CAN but DON'T file jointly, still no subsidy.

If the CAN but DON'T file jointly, how will the govt know?

 

[RayNY]

So if they CAN file jointly, no subsidy. But if they CAN but DON'T file jointly, still no subsidy.

If the CAN but DON'T file jointly, how will the govt know?

Simple answer, "Filing Status" is literally the first question on a 1040 after you put in your name and address.

Unless you lie on your taxes and claim to be single while married, they'll know if you're eligible to file jointly but choose to be separate (it even asks for your spouse's SSN).

On an aside, being able to file jointly, doesn't disqualify one from subsidies unless the joint status also causes another ineligibility (employer coverage, over income limit jointly, etc.). You can certainly file jointly and obtain a subsidy so long as you qualify otherwise.

 

[somarco]

https://www.youtube.com/watch?v=kTcRRaXV-fg

 

[bluediamond]

This may or may not clear some things up:

Common-law marriage in the United States - Wikipedia, the free encyclopedia

Excerpt:

Income tax[edit]
A common-law marriage is recognized for federal tax purposes if it is recognized by the state where the taxpayers currently live, or in the state where the common-law marriage began. If the marriage is recognized under the law and customs of the state in which the marriage takes place (even if the state is a foreign country), the marriage is valid (Rev. Rul. 58-66). Practitioners should be alert to the specific state requirements necessary for their clients contemplating filing joint returns under common-law marriage statutes.
Availability by state[edit]

This section needs additional citations for verification. Please help improve this article by adding citations to reliable sources. Unsourced material may be challenged and removed. (September 2010)
Common-law marriage can still be contracted in nine states (Alabama, Colorado, Kansas, Rhode Island, South Carolina, Iowa, Montana, Utah and Texas) and the District of Columbia. New Hampshire recognizes common-law marriage for purposes of probate only, and Utah recognizes common-law marriages only if they have been validated by a court or administrative order.[1]

 

[Bobby]

So if a couple lives together and they file separate taxes can they jointly apply for Health plan as a couple or do they have to have separate policies ?

 

[RayNY]

So if a couple lives together and they file separate taxes can they jointly apply for Health plan as a couple or do they have to have separate policies ?

Non-married cohabiting adults may enroll as a "couple" if they prove Domestic Partner Status (affidavit, proof of financial interdependence, or whatever the carrier requires).

They may certainly obtain separate policies if they like.

As for the whole "common-law marriage" thing (which, according to bluediamond's citation, does not apply to GA (anymore), and is thus, a non-issue for this discussion), they hold themselves as "engaged" and not "married". Thus, they are not married under common law anyway.

 

[Bobby]

Thank you Ray..................................

 

[hamben]

Well the hits just keep on coming. I had one today where Mom is 50. has custody of her grand nephews and she makes 14,000 a year. Kids get sent to s chip and mom gets nothing because she is below poverty. she also has 23 year old daughter living with her. Daughter makes 15,000 a year but files her own taxes. the household income would qualify both for subsides but when application was submitted only the 23 year old daughter qualified for subsidies.

Question, Mom is only $2,000 in income away from qualifying for $355 in tax credits. she is working another job and thinks she will make that much next year. if she puts the extra income down and qualifies for the $355 and then does not earn enough to qualify for the tax credits will she have to pay back?