Health Care Penalty - for when I wasn't even living here?!?!

[Exocet 88]

Hey everyone,

Tax time! I'm sure most people are freaking out about it.. but hopefully someone can help answer my question.

Background:

CR1 Visa/Green card holder

POE: October 3, 2014 and been living in Florida since

I had Canadian healthcare and a work health plan up until Sept 30. I got a health plan through Coventry that was called a "new immigrant" health plan. I think it was really just a travel insurance plan. Anyway!

My hubs and I are doing our taxes, and it seems as though they want to assess a penalty on me for the 9+ months I WASN'T EVEN LIVING IN THE US!!! How does this make sense? When I crossed the border I had the new health insurance in effect.. but how on earth can they penalize me for not having it when I didn't even live here? What am I missing?

We read through all of the conditions in which the penalty could be waived, but none of them seem to apply to me. Or does the fact that I had Canadian health insurance enough?

Please help! Thanks! :)

[dburnt 59]

We listed me as having health care for the entire 2014 year (in addition to Ontario OHIP I also had employer benefits for a period). I was not assessed a penalty. Technically Canadian health care is the same as US health insurance (your premiums are paid by tax dollars is all)

I have noticed that both US and Canadian tax forms don't seem to address immigration/emigration at all.

Welcome to Florida ;-)

Edited April 15, 2015 by dburnt

[asisflyer 47]

Did you file a 2555 or 2555 EZ ?

If you can pass the Bona Fide Foreign residence test in the prior year to tax year -- OR physical presence test .... you can exclude these periods of time

as Exception Code C on Form 8965 for those months.

You are also permitted the 3-month continuous gap (Code B) in the year also...

So if you passed the 330 day physical presence test or qualify as bona fide ending in that year, you run Jan - Sep as C and then Oct, Nov, Dec as Code B - 3 month gap.

If for some reason you did not meet Bona Fide or 330 Day Physical Presence while in Canada, then I think you are stuck UNLESS your Canadian plan was deemed QHP by HHS or you can use the affordability exception etc.

[Gleici&Daryl 0]

Did you file a 2555 or 2555 EZ ?

If you can pass the Bona Fide Foreign residence test in the prior year to tax year -- OR physical presence test .... you can exclude these periods of time

as Exception Code C on Form 8965 for those months.

You are also permitted the 3-month continuous gap (Code B) in the year also...

So if you passed the 330 day physical presence test or qualify as bona fide ending in that year, you run Jan - Sep as C and then Oct, Nov, Dec as Code B - 3 month gap.

If for some reason you did not meet Bona Fide or 330 Day Physical Presence while in Canada, then I think you are stuck UNLESS your Canadian plan was deemed QHP by HHS or you can use the affordability exception etc.

Aren't you only suppose to use Code "B" for less than 3 months? Shouldn't he just put exemption code "C" for the full year?

[Exocet 88]

Hey everyone,

Thanks for the replies! Basically what confused the heck out of us was that Turbo Tax did not list all the exemption possibilities. So, hubs and I looked up the official IRS document that explained the exemptions, and realized that my Canadian healthcare was sufficient. I went with Code "C", and the penalty was waived. Whew!

I have noticed that both US and Canadian tax forms don't seem to address immigration/emigration at all.

I KNOW! With the extremely high immigration/emigration from both countries, you would figure they could get the forms a little more up to date. Ah well. We finally figured it out, crossed our fingers and e-filed. Here's hopin!