Form 1099-H: Health Coverage Tax Credit (HCTC) Advance Payments (2012)

What this form reports

Form 1099-H shows the advance HCTC payments the government sent directly to your insurer in 2012. Under the program, eligible individuals had 72.5% of qualified health insurance premiums paid by the government; you paid the remaining 27.5%. The form prevents double-claiming the same credit on your tax return.

Who typically receives it:

• Eligible TAA/ATAA/RTAA recipients
• PBGC pension payees (and certain qualifying family members)
• Participants enrolled in the HCTC advance payment program, administered by the HCTC Transaction Center (or occasionally by the insurer)

Who issues it: Your insurer or the HCTC Transaction Center.

When you’ll use it (late / amended)

You’ll use Form 1099-H while preparing your 2012 federal return (filed in 2013)—and again if you amend.

• Late filing: Still include the Form 1099-H amounts to avoid double benefits.
• Amend (Form 1040-X) if:
  • A corrected 1099-H arrives with different amounts,
  • You claimed HCTC on Form 8885 for months that already had advance payments,
  • You later learn you were ineligible for months shown on the form, or
  • You need to reduce a self-employed health insurance deduction for HCTC amounts.

Amending window: generally 3 years from the original 2012 due date (typically to Apr 15, 2016).

2012 rules you need to know

Credit percentage: Government paid 72.5% (advance); you paid 27.5%.
Eligibility (on the 1st day of each month): Eligible TAA/ATAA/RTAA or PBGC status, qualified health coverage, not enrolled in Medicare/Medicaid/CHIP/FEHBP/TRICARE, not imprisoned, employer did not pay ≥50% of premiums, and no 65% COBRA premium reduction.
Furnishing/filing deadlines: Recipient copy by Jan 31, 2013; IRS Copy A by Feb 28, 2013 (Apr 1, 2013 if e-filed).
No double-dipping: You cannot also claim a credit on Form 8885 for months already covered by advance payments shown on Form 1099-H.

How to read the form (key boxes)

• Box 1: Total HCTC advance payments for 2012.
• Box 2: Months you received advance payments.
• Boxes 3–14: Monthly breakdown (Jan–Dec) of advance payments.

Where it fits in your return (high level)

1. Decide if you file Form 8885.
   • File Form 8885 only for months you paid 100% directly to the insurer (i.e., no advance payment that month).
   • Don’t include any month listed on Boxes 3–14 on your Form 8885 credit calculation.
2. Complete Form 8885 (if applicable).
   • Check eligible months; enter your payments (not the advance).
   • Compute the credit (72.5% of your eligible payments).
   • Attach required proof of coverage and payment.
3. Adjust other claims.
   • If claiming the self-employed health insurance deduction, reduce it by:
     • Box 1 (advance HCTC), plus
     • Any HCTC you claim on Form 8885, plus
     • Any amounts you paid through “U.S. Treasury–HCTC.”

Keep Form 1099-H with your records; you don’t mail it to the IRS.

Common mistakes (and quick fixes)

• Claiming HCTC for advance-payment months
  Fix: Exclude months shown in Boxes 3–14 from Form 8885.
• Counting amounts paid to “U.S. Treasury–HCTC” on Form 8885
  Fix: Payments routed through the program are not eligible again.
• Missing documentation
  Fix: Attach insurance bills, proof of payment (checks/bank statements), COBRA letters, and coverage dates for months claimed on Form 8885.
• Including ineligible coverage
  Fix: Standalone dental/vision and other excepted benefits don’t qualify. Get an itemized bill if they’re bundled.
• Not reducing the self-employed health deduction
  Fix: Subtract Box 1 + Form 8885 credit + Treasury–HCTC payments before computing the deduction.
• Ignoring a corrected 1099-H
  Fix: File Form 1040-X with the corrected amounts.
• Family eligibility mix-ups
  Fix: Family members must meet the same no-Medicare/Medicaid/FEHBP/TRICARE rules; divorced/deceased rules apply—check the 2012 instructions.

After you file

• IRS matching: Your return is matched to 1099-H submissions.
• Notices: If you claimed months with advance payments, expect a CP2000-type notice.
• Ineligible advance months: Excess advances are treated as additional tax via Form 8885 (see 2012 instructions).
• Keep records: Retain forms and documentation at least 3 years.

FAQs

1) Do I mail Form 1099-H with my return?
No. Keep it for your records. Attach Form 8885 only if you’re claiming HCTC for non-advance months.

2) My 1099-H shows months I wasn’t covered.
Ask the issuer (insurer or HCTC Transaction Center) for a corrected form; amend with Form 1040-X if you already filed.

3) Can dental/vision premiums qualify?
Standalone dental/vision generally don’t qualify. If integrated in comprehensive coverage (and not “substantially all” of the plan), the full premium may qualify—see the 2012 instructions.

4) I paid my 27.5% to “U.S. Treasury–HCTC.” Can I still claim Form 8885 for those months?
No. Those months already received the advance benefit.

5) I enrolled in Medicare mid-2012.
You become ineligible for your HCTC that month; qualifying family members may continue for up to 24 months (or until Jan 1, 2014, if earlier). Request a correction if the form shows your coverage after Medicare enrollment.

6) I’m self-employed—how does this affect my deduction?
Reduce your self-employed health insurance deduction by Box 1 + any Form 8885 credit + any Treasury–HCTC payments.

7) Who can help?
HCTC Customer Contact Center: 1-866-628-4282 (TTY 1-866-626-4282). IRS help: 1-800-829-1040. See: Form 1099-H (2012), Form 8885 (2012), and their instructions on IRS.gov.

Sources (2012): IRS Form 1099-H & Instructions, and Form 8885 & Instructions (prior-year PDFs on IRS.gov).

‍