California health insurance - Individual and Family plans - Covered California tax filing status

Tax Filing Status and Covered California Subsidy

Answering your Covered California application in certain ways can keep you from getting a subsidy that you may be eligible for.

Since the first open enrollment period, we helped 1000's of existing Covered Ca account holders finalize their application after they ran into issues.

A good percentage of these applications (north of 50%) had errors in how they answered certain questions which would significantly affect the subsidy they were being offered or even if they would receive one at all.

We wonder how many of the 500K+ accounts that were submitted directly are in similar situations and will receive a nasty wake-up call next April at tax time.

Let's see if we can clear up the issue of tax filing status and subsidy eligibility on this page.

Of course, we're happy to walk you through the process and make sure you get everything due to you and there is no cost for our services.

Tax filing options on the Covered Ca health application

These are the standard tax filing options on the Covered California application:

Single
Head of Household
Married filing Separately
Married filing Jointly

The latter two are where we see the most issues.

Here's the basic rule.

If you are married and filing separately, you and your spouse will not be eligible for a subsidy.

It doesn't matter what your income is.

If you are married, you must file the current year's taxes as jointly to qualify for a subsidy (if eligible based on other considerations).

Important note...last year's tax filing status doesn't matter.

For example...you might have filed as separately last year but if you file jointly for this current year, you may be eligible for the subsidy.

Obviously, there may be other tax benefits to filing separately (otherwise, why would you file that way) which is a tax issue.

We're happy to walk through your situation and see if the health insurance subsidy part of the equation offers an advantage to your tax filing status. Check in with us help@calhealth.net with your situation.

The system will automatically block a consideration of a subsidy for married filing separately.

If you have listed filing jointly on the application and a subsidy still is not being offered, contact us as there are other sections of the application can cause similar issues.

One note...one spouse can still enroll without the other spouse but we include everyone that's filing together on a 1040 tax form to get the correct tax credit!

Single and Head of Household Filing Status

The Single or Head of Household tax filing status does not impact our ability to get a subsidy. The Head of Household generally just refers to claiming non-spousal dependents (for example children).

You still list everyone's that filing together on a 1040 tax form (next April) even if they're not enrolling.

Tax Filing Status/Timing and Subsidies

One note...when enrolling in Covered California, you essentially confirm that you will file taxes as required by law and on time if you are required to.

Some people do not need to file taxes since their income is below the threshold. They will need to file in order to get a tax credit though!

Again, as certified Covered California agents, there is no cost for our services.

You can quickly delegate us as the agent and we can then go through find out where the issues are in your entered information.

In five minutes, we can save you hours of frustration and potentially a great deal of money.