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Re: medical insurance obmacare for 2015 self employed

October 11, 2016 • Marco Ahtirski • Log In to Post Comments

client will file 1040 for 2015 - only schedule 'C" income and a a small loss from a partnership for 2015 -  married filing joint, were covered through obama care received form 1095 A, they paid $ 16919.00 for mecial insurance which we dedcuted on 1040 line 29 for health insurance and also self employment tax line 27 for 3,090.00. The lacerte program genearated form 8962 with a tax redit of $ 4857, using as Modified AGI the number from Line 37 of the 1040, which appears to me incorrect, do we have to add back the adjustment for health insurance and  S.E. tax form from line 29 and 30 to arrive for the correct # for the Modified AGI for the credit? Confused and tired.

Thank you

Marco

 

 


Comments

Marco,

It appears Lacerte is properly calculating the Modified AGI for purposes of the Premium Tax Credit for you.

The modified AGI for purposes of the PTC is calculated by starting with your AGI on line 37, then adjustments are made for tax-exempt interest, foreign earned income, and nontaxable Social Security benefits (see the instructions under Line 2a for Form 8962 here for a worksheet: https://www.irs.gov/pub/irs-pdf/i8962.pdf).  Neither the self-employed medical insurance on line 29 nor the deductible part of the SE tax on line 27 need to be backed out.

 

 

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