How to report shared policy allocation on Form 8962 (Marketplace insurance) Form 1095-A?

When a Marketplace health insurance policy covers people from more than one tax household, the amounts on Form 1095‑A must be allocated between returns using Form 8962, Part IV. This is called a Shared Policy Allocation.

Shared policy allocation rules vary based on your filing status and life events (such as marriage or divorce). Use the guide below to make sure you’re following the correct steps for your situation.

Choose your situation

Use the links below to go directly to the instructions that apply to you:

Married Filing Separately (MFS)

If you were married at the end of the year and are filing separate returns
→ How to report shared policy allocation for MFS on Form 8962

Divorced or legally separated

If you and your former spouse shared a Marketplace policy during the year
→ How do I report Shared Allocation Policy amounts when I am divorced (Form 8962)?

Year of marriage (Alternative Calculation)

If you married during the year and need to reduce excess APTC using Form 8962, Part V
→ How do I fill out the Alternative Calculation for Year of Marriage (Form 8962 Part V)?

Claimed as a dependent

If you are claimed on another person’s return
→ I am a dependent on another person’s return. How do I answer the health insurance question?

⚠️ Important: These scenarios use different IRS rules and sometimes different parts of Form 8962. Following the wrong instructions can result in errors or IRS rejections.

What is a shared policy?

A shared policy exists when a Marketplace insurance plan covers:

At least one person on your tax return, and
At least one person who is NOT on your tax return

Because Form 1095‑A is issued at the policy level, the IRS requires the policy amounts to be split between the affected tax returns.

When a shared policy allocation is required

You must allocate policy amounts if any of the following apply:

The Marketplace plan covers individuals from multiple tax households
You were divorced or legally separated during the year and previously shared a policy
You are Married Filing Separately, and you and your spouse were enrolled in the same policy
You (or a dependent) were covered under a policy purchased by someone outside your tax family
An adult child files their own return while remaining on a parent’s Marketplace plan

When a shared policy allocation is NOT required

You do not need to allocate policy amounts if:

Everyone covered by the policy is claimed on the same tax return
You are claimed as a dependent on another person’s return
(In this case, the person claiming you reports Form 1095‑A and files Form 8962.)

What amounts are allocated

The following monthly amounts from Form 1095‑A, Part III must be allocated:

Column A – Monthly enrollment premiums
Column B – Second Lowest Cost Silver Plan (SLCSP) premiums
Column C – Advance payment of the Premium Tax Credit (APTC)

The same allocation percentage must be used for all three columns for each applicable month.

How allocation percentages work

If all parties agree

Taxpayers sharing the policy may agree to any allocation percentage as long as:

The combined percentages equal 100%
The same percentage is used for Columns A, B, and C
Percentages may vary by month if coverage changes

If parties do NOT agree

If you cannot agree on percentages, the IRS default rule applies:

Allocation percentage = (Number of individuals in your tax family covered by the plan) ÷
(Total number of individuals covered by the plan)

How to enter a shared policy allocation in TaxSlayer

Go to Federal → Health Insurance
Answer Yes to:
“Did you, your spouse, or a dependent have insurance under the Affordable Care Act?”
Continue to the Advance Premium Tax Credit (Form 8962) section
Select Allocate policy amounts (Form 8962, Part IV)
Choose Add another allocation
Enter:
- Policy number (enter only the last 15 digits if longer)
- Social Security number of the other person sharing the policy
- Allocation start and stop months for the taxpayer completing the return
- Your allocation percentage for Columns A, B, and C
When prompted about full‑year coverage with no changes, answer No
Manually calculate and enter the allocated monthly amounts

⚠️ Important: TaxSlayer does not automatically calculate allocated amounts.
You must multiply your allocation percentage by the Form 1095‑A amounts for each applicable month.

Taxpayer claiming 0% allocation

If you are claiming 0% allocation, for example an adult child not being claimed as a dependent on the parents return, you must follow specific rules. This is because IRS e‑file validation requires a non‑zero value in at least one of the premium fields.

Select Allocate policy amounts (Form 8962, Part IV)
Choose Add another allocation
Enter:
1. Policy number (enter only the last 15 digits if longer)
2. Social Security number of the other person sharing the policy
3. Allocation start and stop months for the taxpayer completing the return
4. Your allocation percentage for Columns A, B, and C (in this scenario, 0%)
When prompted about full‑year coverage with no changes, answer No
Manually calculate and enter the allocated monthly amounts as follows:
- Monthly Premium- $0
- Monthly SLCSP - $0
- Monthly APTC - $0

In this case, the return must be printed and mailed to the IRS as e-filing will result in rejection code F8962‑063.