Tested for COVID-19 Yet? The IRS Might Have Some Good News For You
Since the beginning of COVID-19, taxes and refunds have been on everyone’s mind. Maybe you’ve successfully filed your taxes for 2019 and are en-route to receiving your refunds. Maybe you’re still waiting on that refund. Either way, here’s a little good news. You may be eligible to receive tax credits if you’ve tested for COVID-19 this year. Keep reading to find out how!
Notice 2020-66 was issued by the IRS on September 10th, 2020, which provided information regarding the premium tax credit and Medicaid coverage of COVID-19 testing and diagnostic services. The notice addresses whether “certain Medicaid coverage of COVID-19 testing and diagnostic services is minimum essential coverage for purposes of the premium tax credit”.The notice stated that the IRS along with the Treasury Department intend to amend the Income Tax Regulations and add Medicaid coverage of COVID-19 testing and diagnostic services as not under minimum essential coverage under a government sponsored program and therefore, does not affect the premium tax credit eligibility.
Minimum essential coverage usually includes coverage under government sponsored programmes and also Medicaid Coverage. A premium tax credit is one that lowers an eligible individual's monthly insurance payment and individuals who are eligible to purchase coverage through a Health Insurance Exchange can claim a premium tax credit. Usually, a taxpayer is allowed premium tax credit only for “coverage months” for the individuals in their family, and coverage months are those months where the individual is not eligible for minimum essential coverage, except coverage in the individual market.
In conclusion, as the premium tax credit requires to be eligible for minimum essential coverage and health care coverage that provides limited benefits is not considered minimum essential coverage under a government sponsored program, the premium tax credit eligibility will be affected by Medicaid COVID-19 testing and diagnosis services.
Need help navigating through your taxes? Give Robert Giaccone, CFP a call at (516) 284-1565 or contact Landmark Tax and let us know how we can help you today.