8852 / Can a taxpayer still qualify for a premium assistance tax credit if exempt from the shared responsibility penalty under the Affordable Care Act?
Yes, in some instances. Whether a taxpayer who was otherwise exempt from the shared responsibility penalty remained eligible to claim the premium assistance tax credit depended upon the type of exemption that applied. According to IRS guidance, taxpayers who were exempt because they are incarcerated or not lawfully present in the U.S. are not eligible to claim the premium tax credit. This is the case, however, because these exempt individuals are not permitted to enroll in a health plan through the health insurance exchanges. Individuals who were exempt for other reasons, such as because a religious exemption or affordability exemption applied, would remain eligible to claim the premium tax credit if they otherwise met the requirements for eligibility.1
See Q 8847 for a detailed discussion of the various exemptions. See Q 8849 for a discussion of the qualification requirements for determining whether a taxpayer is generally eligible to claim the premium tax credit.
1. See IRS Questions and Answers on the Individual Shared Responsibility Provision, available at: http://www.irs.gov/uac/Questions-and-Answers-on-the-Individual-Shared-Responsibility-Provision (last accessed September 28, 2024).
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