Over the last few weeks we have been receiving many calls from our clients inquiring what type of documentation they could provide to their employees for proof of healthcare coverage when filing their 2014 tax return.   We wondered why employees were looking for this, since the ACA does not require such proof of coverage for 2014. Under the ACA, for 2014 individuals were mandated to either be enrolled in a healthcare plan or pay a penalty. However, due to many changes in the ACA law and the impending implementation of the reporting requirements in 2016 (based on 2015 enrollment), the IRS is not requiring proof of medical coverage for 2014 individual tax filings.  Instead, they are considering that the health plan enrollment information will be provided by individuals on the  “honor system” when filing their 2014 tax return.

It seems though, that as some accountants are preparing individual tax filings, they are asking the tax filers for proof of coverage even though this is not required by the IRS.  Our hypothesis is that accountants want to have proof of coverage to ensure the information is accurate before they sign the tax returns stating that the filing is factual.

So, what should individuals supply for proof of coverage? If the accountant is persistent that the individual must provide documentation the individual can call their healthcare carrier and ask them for a “Confirmation of Coverage Letter”.  The carrier would need to generate the letter and send it to the individual.   Alternatively, there is usually something on the individual page of the carrier’s member portal that will show how long the member has been active on the plan.  A screenshot of that statement could provide proof of coverage.

The following statement is from the Obamacare Facts website:

“Minimum Essential Coverage is the type of coverage you’ll need to avoid the fee for not having insurance under ObamaCare (the Affordable Care Act). In order to be in compliance with the law you must maintain minimum essential coverage throughout the year, get an exemption, or pay a fee for each month you go without it (although you are allowed less than three months in a row each year without coverage, due to a coverage gap exemption). You’ll report minimum essential coverage on your Federal Income Taxes for each month you or a dependent had coverage. Calculate the fee they have to pay(in case they did not had it for any month) .

How to Report Minimum Essential Coverage For 2014. When you file your 2014 taxes by April 15, 2015, you’ll report whether or not you had coverage each month on line 61 of a standard 1040. For 2014 ONLY this is based on “the honor system”. So if you had coverage your answer “yes”, if you didn’t you answer “no” and calculate your fee.

Have your employees asked for proof of coverage?

Leave a comment to let us know how you’ve been handling the request.


If you have questions about this or any aspect of the ACA and how it affects your business, contact Bell Associate’s ACA experts at 203-707-1300 or email info@bellassoc.com. You can also visit us at www.bellassoc.com.

This article refers to regulations issued through December 31, 2014.  It is intended to be a summary of important issues and should not be considered legal or tax advice.

© Bell Associates and “Ask the Professionals,” 2015. Unauthorized use and/or duplication of this material without express and written permission from Bell Associates is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Bell Associates and “Ask the Professionals” with appropriate and specific direction to the original content.