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8962 Form 2021

Form 8962— Premium Tax Credit is the IRS tax form that is used for figuring out the premium tax credit amount.

Before we get to Form 8962, let us explain the premium tax credit. The premium tax credit is a refundable tax credit similar to the earned income tax credit. Its purpose is to help low to moderate income households cover the cost of health insurance purchased through the Health Insurance Marketplace.

As a general rule, the lower your income, the higher your premium tax credit. This is because federal law requires every American to carry some form of health insurance. Since this is a must, the costs can be a burden so the premium tax credit helps those with low to moderate income to cover their cost of health insurance.

Not only the income of the household but the cost of the Marketplace plan will affect the premium tax credit. How the plan of choice will affect the premium tax credit can be seen before purchasing the plan. The Health Insurance Marketplace allows taxpayers to figure out their premium tax credit before purchasing the plan.

Although such calculations are offered beforehand, we suggest filing Form 8962 to be sure. In the 2021 tax season, you must file Form 8962 to determine the amount of premium tax credit you can claim anyways. Below, you can obtain Form 8962 as PDF or start filing it online.

2021 Form 8962 Online

The Internal Revenue Service publishes Form 8962 on the agency’s website as PDF. If printing out the form is what you need, this is what you’re going to need. But there are better ways to use Form 8962 to figure out the amount of the premium tax credit.

Start filling out Form 8962 2021 by clicking the boxes you want to enter your information. This version of 2021 Form 8962 is online fillable. Every information you enter on it will remain on the form upon downloading or printing it out.

Form 8962 Instructions

On Form 8962, you will detail the following to determine the premium tax credit amount.

Part 1

  1. Family size
  2. Modified Adjusted Gross Income (MAGI)
    • Dependents’ MAGI
  3. Total Household Income
  4. Federal Poverty Line from Tables 1-1, 1-2, or 1-3 and select the state used for poverty table. It can be Alaska, Hawaii, or other 48 states and the DC.
  5. Household income as a percentage of the federal poverty line.
  6. If you entered 401% on Line 5, you aren’t eligible for the premium tax credit. If no, proceed to next line.
  7. The applicable figure, you need to enter 5 percent of the applicable figure.
  8. Enter annual contribution amount and multiply line 3 by line 7 and enter the monthly contribution amount on Line 8b.

Part 2

9. If you are allocating policy amounts with another taxpayer or if you want to use the alternative calculation for year of marriage, check yes and skip Part IV. If no, continue to the next line.

10. See instructions to see if you can use line 11. If yes, continue to Line 11 and calculate your annual premium tax credit. If not, continue to lines 12 through 23.

24. Enter total amount of premium tax credit.

25. Enter the advance payment of premium tax credit. This amount is figured by adding lines 12 through 23.

26. Your net tax credit. If the line 24 is more than line 25, subtract the amount seen on line 25 from the line 24. Enter the difference here on Schedule 3, Line 9. If you’re filing Form 1040-NR, enter it on Line 65.

Part 3

27. Enter the excess advance payment of premium tax credit. If the line 25 is more than line 24, subtract line 24 from 25 and enter the difference.

28. Enter repayment limitation.

29. Enter the excess advance premium tax credit repayment. You can find this amount by entering the smaller lines of 27 and 28 and on Schedule 2 Line 2 or Line 44 of Form 1040-NR.

Part 4

On Part 4 of Form 8962, you must enter the allocation of policy amounts. You can enter up to four allocations. If you complete all policy amount allocations, you can then proceed to multiply the amounts on Form 1095-A by the allocation percentages entered by the policy. If you didn’t complete all the allocations, proceed to the part if applicable.

Part 5

Enter information about alternative calculation for the year of marriage if you’ve recently been married. On this part of Form 8962, you can enter the alternative family size, alternative monthly contribution amount, and alternative start and stop month for yourself and spouse.

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