What is a 1095-B Form Used For?

A 1095-B form is an essential tax document that verifies your health coverage during the year, especially when it comes to meeting the requirements of the Affordable Care Act (ACA). This form serves as proof that you, or a member of your household, had qualifying health coverage that meets the ACA standards. If you’re curious about how this form fits into your tax filing process or how it affects you during tax season, you’re in the right place! The 1095-B form is issued by health insurance providers, government agencies, and other organizations that provide health coverage. It’s crucial for ensuring you comply with the ACA’s individual mandate, which was initially designed to ensure that everyone has access to health insurance.

As the tax season rolls in, many individuals wonder about the specific documents they need to file their taxes. One of these key documents is the 1095-B form, which provides evidence that you had the required health coverage for the tax year. If you’re wondering whether this form impacts your filing process, the answer is simple: yes, it does! The 1095-B helps the IRS confirm that you had health insurance coverage that meets the minimum essential coverage standards. Without it, you might face penalties or delays in your tax return. Let’s dive deeper into what this form entails, when and how you receive it, and why it’s essential for your tax filing.

What is the 1095-B Form?

The 1095-B form is provided by insurance providers, showing the months you had coverage and which members of your household were covered. It includes detailed information such as the name of your insurer, your policy number, and coverage periods. If you are self-employed or have coverage through a provider like Medicaid, your 1095-B may look a bit different, but it serves the same purpose: ensuring that you had coverage during the year.

When Will You Receive a 1095-B Form?

Typically, you will receive your 1095-B form by January 31st, or shortly after, from your insurance provider or employer. However, if you haven’t received it by the end of February, it’s a good idea to reach out to the provider or agency that issued it. Remember, you don’t need to attach the form to your tax return, but you do need it to complete your filing accurately.

Why is the 1095-B Form Important for Taxes?

The 1095-B form is crucial because it helps ensure you avoid a penalty for not having health insurance. The IRS uses this form to confirm that you had at least minimum essential health coverage for each month of the year. Though the penalty for not having coverage (the individual mandate penalty) was reduced to $0 starting in 2019 for most states, some states still enforce their own mandates. For example, California, New Jersey, Massachusetts, and several other states require you to maintain health coverage or face penalties. In those cases, the 1095-B form is used to prove that you had insurance.

How Do You Use the 1095-B Form for Your Taxes?

When you file your tax return, you’ll be asked to confirm whether you had health insurance coverage. If you did, the information on your 1095-B form will help confirm this. Although you don’t need to submit the form with your return, you must keep it for your records in case the IRS asks for it later. If you didn’t have coverage, you might be subject to the penalty for not having insurance, depending on where you live.

What Should You Do If You Don’t Receive a 1095-B Form?

If you don’t receive your 1095-B form or believe the information is incorrect, you should contact your insurance provider. They may have sent it to the wrong address or there may be an error in the details. Be sure to resolve these issues before filing your taxes to avoid any complications.