800,000 Got Bad Tax Information From Obamacare Site

Personal Finance
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About 800,000 Americans who used the federal HealthCare.gov site to get insurance received bad tax information, the government said Friday.

Those users, who were being notified starting Friday, are being asked to delay filing their federal taxes.

About 90% to 95% of those affected do not appear to have filed taxes yet, according to a release from the Centers for Medicare and Medicaid Services, but roughly 50,000 people who have already filed may have to resubmit their information.

Also Friday, government officials announced that people who’ll be hit with a tax penalty for not having health insurance will be given an extension to sign up for coverage through the federal exchange, which is available in states that didn’t create their own exchanges.

The tax glitch is a mark against what’s been an otherwise smooth second year for the Obamacare site, which suffered through a string of technological glitches during its debut last year. The government says about 11.4 million users have signed up for insurance via the federal marketplace.

“As soon as we discovered the error, we immediately began examining who was affected, how to communicate about the error, and how to make the corrections process as simple as possible for consumers,” the centers said in the release. “We are committed to making sure that consumers who need corrected forms are contacted with updates and will receive new forms quickly.”

The tax errors are in new forms called 1095-As. They document the subsidies that many consumers receive from the government to help cover the cost of their healthcare premiums.

About 20% of people who received a 1095-A form got bad information. Administration official Andy Slavitt told reporters the feds are still investigating what caused the problem.

Affected users should receive a phone call by early March, according to the news release. They can find out now if they were affected by logging onto their account on HealthCare.gov.

People with questions are encouraged to visit HealthCare.gov/taxes or contact representatives at marketplace call centers at 800-318-2596.

The extension for uninsured Americans who learn they are being penalized when they file taxes will last from March 15 to April 30. The deadline for most people to sign up was Feb. 15.

“We recognize that this is the first tax filing season where consumers may have to pay a fee or claim an exemption for not having health insurance coverage,”  CMS Administrator Marilyn Tavenner said in a news release. “Our priority is to make sure consumers understand the new requirement to enroll in health coverage and to provide those who were not aware or did not understand the requirement with an opportunity to enroll in affordable coverage this year.”

Users who use the grace period to sign up will still be assessed penalties for the months they were uninsured. But the extension will let them avoid paying additional penalties for the rest of 2015.