Health Coverage Tax Credit Eligibility
The Health Coverage Tax Credit (HCTC) is a credit available to certain persons who meet qualifying requirements. While this credit has been available for some time, taxpayers may not be aware that the HCTC now covers up to 80% of an eligible taxpayer’s insurance premiums. This is due in part to recent legislation passed as part of the American Recovery and Reinvestment Act of 2009.
There are three stages to qualifying to receive the HCTC. The initial stage is determining whether the individual receives benefits under any one of three categories: Pension Benefit Guaranty Corporation, Trade Adjustment Assistance, or Reemployment Trade Adjustment Assistance. If so, the individual may be eligible depending upon meeting the general requirements for the credit, and being enrolled in a health plan which qualifies under the laws governing the HCTC.
The general requirements state that the individual in question must not be a qualifying child of another filer (unless that filer qualifies for the HCTC him- or herself), and must not be receiving health care aid under another federal program or institution such as Medicaid or TRICARE. Qualifying health plans include COBRA and state-approved health plans (contact home state offices for a complete list), as well as most plans offered by employers as group coverage. Certain individual/non-group plans also apply.
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