Beginning with tax year 2020, California requires residents and their dependents to obtain qualifying health care coverage.
Individuals who purchase a qualified health care plan through the California health insurance marketplace, may be eligible to receive financial assistance to help pay the insurance premiums, known as the Premium Assistance Subsidy (PAS).
How much can I receive?
The amount of PAS available to a household is based on the projected household income for the year. Advance Premium Assistance Subsidy (APAS) paid throughout the year will need to be reconciled at the end of the year with the actual PAS allowed based on the actual household income for the year, less federal Premium Tax Credit (PTC) amounts.
What forms do I need to complete the 3849?
Only the information on Form 3895 is required to be entered in the tax return on Form 3849 for the purpose of reconciling APAS received versus PAS allowed. Form 1095-A should not be used to complete Form 3849, since the PAS is in addition to the federal APTC.
If the taxpayer is expecting to receive Form 3895 and doesn't have it by early February, they should log into their account at Covered California.
What if I am not required to file a California return?
An individual who otherwise wouldn't be filing either Form 540 or 540NR must file a return if any of these scenarios applies:
- they are taking PAS.
- APAS was paid to them or another individual in their household.
- they told the Marketplace that an individual was in their household, and no other tax return includes or will include that individual in their household.
If anyone in the taxpayer's household was covered by health insurance from the California health insurance marketplace, you'll need to use the information on their Form 3895 to complete Form 3849.