Biz Bits: How the Affordable Care Act may affect your tax refund
Tip of the Week
The Affordable Care Act (ACA) brings a lot of changes to this year’s tax code. Do you know if and how it will affect your tax refund?
Here are five tips from H&R Block to help you understand how your taxes and tax refund will be affected as a result of the biggest tax code change in more than 20 years.
1. Understand what will be different on your return as a result of the ACA.
The ACA has created a new intersection between healthcare and taxes. Starting this year, three elements are administered through your tax return, including:
* Reporting if you and members of your household have qualified health insurance.
* Accounting if you received any government assistance to help pay for your health insurance through your state’s exchange or HealthCare.gov.
* Determining a penalty, or exemption, if you, or someone in your household, don’t have insurance.
2. Be aware if you fall into one of the two main categories that could be affected the most:
* You purchased insurance through the federal marketplace or state marketplace.
* You don’t have insurance and may have to pay the tax penalty.
If one of these applies to you, you might see the biggest change on your tax return.
3. If you received the Advance Premium Tax Credit, understand what will happen at tax time this year to settle up your credit.
If you or someone in your household received the credit, you must file a tax return so the credit can be reconciled. The estimated income you reported will be compared to your actual income. This could affect you in two ways:
* If your actual household income was more than you estimated, you may have to pay back some or all of the credit you received - up to the maximum repayment cap amount. This will likely reduce the amount of your tax refund, or add to your taxes due.
* If your actual household income was less than you estimated, you may get money credited to your return.
4. Determine if you qualify for an exemption.
Many people may qualify for an exemption to reduce or eliminate their ACA tax penalty. More than 30 available exemptions can apply, and they fall into two categories:
* Exemptions you claim on your tax return.
* Exemptions granted by the Health Insurance Marketplace.
5. Complete and bring the necessary forms.
If you or a member of your household received the Advance Premium Tax Credit, you will receive the new form 1095-A from the marketplace. Don’t forget to bring this form to your tax appointment - your tax return cannot be completed without it. It should be mailed to you by the marketplace by the end of January. If you don’t receive it, you should be able to access a copy through your marketplace account or by contacting the marketplace.
Every year the No. 1 resolution made by individuals is to get in shape. That’s a boon for health clubs but can be a boondoggle for those who choose to join.
In the past two years, national complaints have grown 20 percent, topping 8,000 last year alone. The complaints range from billing and collection issues to overall unhappiness with the contract.
“The number of complaints filed show that the negative issues that surround gym memberships show no sign of change,” said Steve J.Bernas, president & CEO of the Better Business Bureau in Chicago. “Picking the best gym or fitness center for your personal interests can be a difficult choice, so check each one’s rating on the BBB website. It’s important to do careful research before making a final decision and signing on the dotted line.”
Five questions to ask the gym:
1. What are the terms of any introductory offers? Gyms often use special introductory offers to lure in new members. Make sure you understand the terms and what the price will be once the introductory period is over.
2. Will my membership renew automatically? Many times people who join a gym don’t realize that their contract renews automatically and that they would have to take specific steps to cancel their contract.
3. How can I get out of my contract? Getting out of a gym contract isn’t always as easy as getting into one, so make sure you understand what steps you would need to take to cancel your membership.
4. What happens if I move? Gyms have any number of different policies when it comes to how moving will affect your membership. It might depend on how far away you’re moving and if they have other locations nearby.
5. What happens if the gym goes out of business? Ask the gym to explain what will happen to your money if they suddenly close down.
According to Forbes, here were the biggest charitable donations in 2014:
1. $1 billion, made by Ralph Wilson Jr., former Buffalo Bills owner, to the Ralph C. Wilson, Jr. Foundation
2. $650 million, made by Ted Stanley, founder of MBI Inc., to Broad Institute
3. $500 million, made by Nicholas and Jill Woodman, cofounders of GoPro, to Silicon Valley Community Foundation
4. $350 million, made by Gerald and Ronnie Chan, founders of the Morningside Group, to Harvard School of Public Health
5. $177.3 million, made by Larry Page, cofounder of Google, to Carl Victor Page Memorial Foundation
Number to Know
$2.29: Average cost of a gallon of gas in the U.S. at the end of 2014, according to the U.S.Energy Information Administration
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