Form 8965 for Health Coverage Exemptions
At eFile.com, we cover all the healthcare tax forms in the following pages:
- Form 1095-A-Health Insurance Marketplace Statement
- Form 1095-B-Health Coverage
- Form 1095-C-Employer-Provided Health Insurance Offer and Coverage
- Form 8962-Premium Tax Credit
- Form 8965-Health Coverage Exemptions (this page)
When you prepare your tax return on eFile.com, you can easily report and efile your healthcare information with your return.
This is a form a taxpayer uses to report an exemption from owing a tax payment for not having health insurance during the year. Though it might sound complicated, it's easy to do on eFile.com. You'll only need to answer a few simple questions to complete the form if you prepare and file your tax return on eFile.com. You include this form with your tax return in order to report your health insurance exemption from owing a tax payment. When you prepare and file your return on eFile.com, the exemption is automatically calculated for you and Form 8965 is submitted for you to the IRS.
Form 8965 and Your Tax Return
You must file a tax return with Form 8965 if you or anyone in your family qualifies for a health coverage exemption. It's easy to prepare and efile your return on eFile.com if you have multiple exemptions to report; just answer a few simple online questions and the software will generate the form for you (as well as help you complete and file it).
If your income is below the tax return filing requirements, you do not need to file a tax return to only report your coverage or claim the exemption. Therefore, you are automatically exempt from the shared responsibility payment.
However, if you choose to file a tax return, you will need to claim the coverage exemption, but you should be exempt from making the payment since your income is below the filing requirements. The eFile.com software will calculate this information for you when you prepare and file your return on eFile.com.
To find out if you need to (or want to) file a tax return, use our free FILEucator tax tool.
If you are already granted and approved for an exemption through your health insurance Marketplace, you don't need to include Form 8965 with your tax return. Otherwise, you will need to include the form with your return in order to qualify for the exemption. If you prepare and file your return on eFile.com, the software will determine whether or not you need the form based on your answers in the efile interview.
You send the form to the IRS with your completed tax return. The eFile.com software will generate this form for you when you prepare and efile your tax return on eFile.com. Form 8965 will be directly submitted with your tax return to the IRS. There's no need for you to mail it in!
Form 8965 Exemptions
You can only claim the following exemptions on Form 8965:
- Unaffordable coverage (either through employer or self-employed)
- Short coverage gap
- Income below filing requirement
- Citizen living abroad or certain noncitizen
- Resident of state that did not expand Medicaid (Alabama, Alaska, Florida, Georgia, Idaho, Indiana, Kansas, Louisiana, Maine, Mississippi, Missouri, Montana, Nebraska, North Carolina, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, Wisconsin, and Wyoming)
- Being a member of a heath care sharing ministry
- Being a member of an Indian tribe
- Being incarcerated
You can claim any of the exemptions above on Form 8965 when you prepare and file your return on eFile.com.
Exemptions That Cannot Be Claimed
Though you can report most healthcare exemptions on Form 8965 via the eFile.com software, you must apply for the following exemptions via the Marketplace:
- Being a member of a religious sect
- You had a hardship (i.e. eviction, homelessness, foreclosure, death of a close family member, domestic violence, unpaid medical bills) that prevented you from obtaining health coverage under a qualified health plan
- You do not have access to affordable coverage based on your projected household income
- You were deemed ineligible for Medicaid in a state that did not expand Medicaid coverage
- You were notified by your health insurance provider that your policy was not renewable and you considered that other plans available to you were unaffordable
- You were covered by short-term duration or self-funded insurance provided by AmeriCorps State and National, VISTA, or NCCC programs
For information on how to report the exemptions above through the Marketplace, visit healthcare.gov.
Reporting Healthcare Exemptions to the IRS
You claim your health insurance exemption(s) on Form 8965 and attach the form to your tax return. The eFile.com software will automatically generate Form 8965 for you based on your answers to the online software's tax questions. Then, the software will guide you in completing and efiling the form with your tax return. You only need to submit one Form 8965 with your tax return, using separate lines to report each individual and the exemption type.
Even if you had a one-month exemption during the year, you need to report that one month on your return. However, you will not owe a tax payment for not having insurance for that month. It's easy to self-prepare and file your return on eFile.com to claim this exemption.
More Information on Health Insurance and Taxes