Success getting healthcare coverage for immigrant parents over 65

[gradtaai 8]

First, I want to say my knowledge on this subject is pretty light. But I have never heard of the IRS making you claim a dependent. They can tell you "who" will be allowed to claimed. But on the other hand, no one can live with no income. Just the cost of having some place to live is considered an income to the IRS, just as work trade. I would think the IRS could demand the "gift" of housing to have a price, but not sure the IRS would demand the giver to write it off. The IRS and the USCiS have completely different functions. This could be a grey area, or a down right loophole.

[verneforchat 139]

I know this subject has been done to death many many times.

OCare can mean both Insurance you buy with tax subsidies if appropriate and Medicaid which often has local State names.

Generally you are not entitled to Medicaid until you have been a LPR for 5 years, anything paid out by Medicaid would also be reclaimed from your Estate on death.

Not an issue getting tax subsidy, same way as they is not for any other tax credit, mortgage etc for example.

Medicare assuming you do not have the credits you would only be able to buy into after 5 years. Not sure why you would buy Medicare rather than Insurance through the exchange?

Big problem with going through OCare is finding a Doctor etc that will take it, they are used to dealing with Medicare for Seniors that pays them more than OCare.

I don't think your last line is correct.

OCare is not an insurance company itself. You are buying insurance. Doctors/hospitals that accept that particular insurance will offer services.

Medicare does not necessarily reimburse more than other other insurances on the market. Infact, as far as I have seen in terms of billing, they keep it to the minimum.

[ryna 132]

10 things immigrant families need to know about the Obamacare marketplace

https://www.healthcare.gov/blog/10-things-immigrant-families-need-to-know-about-the-marketplace/

Check out #2 - it clearly states that LPRs are eligible for tax subsidies (based on their income, of course.)

LPR parents with no income ARE eligible for tax credits. Period.

They are eligible for tax credits but, depending on the state they live in, they may not get upfront (monthly) subsidies and may have to pay 100% of the premium cost until they file the following year's taxes.

That's what happened to me, a US citizen, when my income dropped to $0 after a job loss and I needed to buy replacement coverage from Healthcare.gov. I called to ask why my subsidy was zero if I had no income and I was told that because my state (Florida) didn't expand Medicaid, and because my current income ($0) was below the minimum, that I was not eligible for the monthly subsidy. I was still eligible to purchase without a subsidy and once I filed the following year's taxes, the amount of the subsidy credit would be determined based on my full year income, but there was nothing - zip, zero, zilch - to help me on a monthly basis because I made too little. Fortunately, in my case, I was able to swing it until something else came along.

[nepusa 0]

Huh? No, I didn't claim my parents as dependents on my taxes. Yes, they filed a separate, completely empty (no income, no taxes, no deductions) tax return (married filing jointly) last year, and plan to do the same this year as well.

I think you are conflating two separate things. Being your parents' GC sponsor does not "require" you to claim them as dependents on your taxes. You are allowed to claim them as dependents, but you may choose not to do so (which is what I did.)

The trade-off is that you give up the standard deductions you'd otherwise get for dependents (and pay higher taxes as a result,) in return for getting a subsidy on their health insurance premiums. Make sense?

Hi Missads,

Hopefully, what you wrote is true that the sponsoring child's income does not need to be included while determining the total income for the immigrant parents.

However after the parents are in the US for 5 years, assuming that they are =/> 65 years of age, they will be eligible for Medicare.

To enroll in Medicare, Immigrants who have not worked in the US for 10 years, will have to pay monthly premiums for Medicare A as well as Medicare B, which again would be expensive.

Do you know if immigrant parents can continue with ACA or if they have to enroll in Medicare after 5 year stay in US?

Thanks

[Umka36 781]

I was able to find this link, which makes obvious sense when you think about it:

"Can a person qualify for a premium tax credit on her own if she could be claimed as a dependent on another taxpayer's return but is not claimed?

No. If a person qualifies as a taxpayer’s dependent, the taxpayer is entitled to that person’s “personal exemption,” whether or not they choose to claim it. A personal exemption is a deduction from taxable income ($4,000 in 2015); reducing the amount of taxable income also reduces the tax one owes. Taxpayers are entitled to the personal exemptions of people who qualify as their dependents, but they are not required to claim dependents. Even if a taxpayer decides or agrees to not claim a dependent’s exemption, that doesn’t make the dependent eligible to claim his or her own exemption. Exemptions are not transferable. If an eligible taxpayer does not claim the exemption, it is lost.

These tax rules are important for the premium tax credit. For example, let’s look at Bob, who is caring for his uninsured mother, Marie. Bob provides more than half of Marie’s support and Marie has no income. Marie qualifies as Bob’s dependent. He wants to enroll Marie in a marketplace plan, but Bob’s income is too high to qualify for marketplace subsidies. Even if Bob chooses not to claim Marie as a dependent on his tax return, Marie is not eligible to claim her own personal exemption on a separate tax return. Because Marie qualifies as Bob’s dependent—whether or not he claims her on his tax return—she cannot qualify for PTC on her own. If Marie applies for health coverage on her own, and at tax time she attempts to file a separate tax return, she will be found ineligible for PTCs and any advance payments of the PTC she received during the year will need to be repaid, up to the cap. If instead, Bob claims Marie as a dependent at tax time, any APTC Marie received during the year will need to be reconciled on Bob’s tax return based on his income."

http://www.healthreformbeyondthebasics.org/question-of-the-day/

Edited October 10, 2016 by Umka36

[Merrytooth 5,748]

I was able to find this link, which makes obvious sense when you think about it:

"Can a person qualify for a premium tax credit on her own if she could be claimed as a dependent on another taxpayer's return but is not claimed?

No. If a person qualifies as a taxpayer’s dependent, the taxpayer is entitled to that person’s “personal exemption,” whether or not they choose to claim it. A personal exemption is a deduction from taxable income ($4,000 in 2015); reducing the amount of taxable income also reduces the tax one owes. Taxpayers are entitled to the personal exemptions of people who qualify as their dependents, but they are not required to claim dependents. Even if a taxpayer decides or agrees to not claim a dependent’s exemption, that doesn’t make the dependent eligible to claim his or her own exemption. Exemptions are not transferable. If an eligible taxpayer does not claim the exemption, it is lost.

These tax rules are important for the premium tax credit. For example, let’s look at Bob, who is caring for his uninsured mother, Marie. Bob provides more than half of Marie’s support and Marie has no income. Marie qualifies as Bob’s dependent. He wants to enroll Marie in a marketplace plan, but Bob’s income is too high to qualify for marketplace subsidies. Even if Bob chooses not to claim Marie as a dependent on his tax return, Marie is not eligible to claim her own personal exemption on a separate tax return. Because Marie qualifies as Bob’s dependent—whether or not he claims her on his tax return—she cannot qualify for PTC on her own. If Marie applies for health coverage on her own, and at tax time she attempts to file a separate tax return, she will be found ineligible for PTCs and any advance payments of the PTC she received during the year will need to be repaid, up to the cap. If instead, Bob claims Marie as a dependent at tax time, any APTC Marie received during the year will need to be reconciled on Bob’s tax return based on his income."

http://www.healthreformbeyondthebasics.org/question-of-the-day/

So the very first post of this thread is not accurate then?

[Umka36 781]

That appears to be the case.

[nepusa 0]

I was able to find this link, which makes obvious sense when you think about it:

"Can a person qualify for a premium tax credit on her own if she could be claimed as a dependent on another taxpayer's return but is not claimed?

No. If a person qualifies as a taxpayer’s dependent, the taxpayer is entitled to that person’s “personal exemption,” whether or not they choose to claim it. A personal exemption is a deduction from taxable income ($4,000 in 2015); reducing the amount of taxable income also reduces the tax one owes. Taxpayers are entitled to the personal exemptions of people who qualify as their dependents, but they are not required to claim dependents. Even if a taxpayer decides or agrees to not claim a dependent’s exemption, that doesn’t make the dependent eligible to claim his or her own exemption. Exemptions are not transferable. If an eligible taxpayer does not claim the exemption, it is lost.

These tax rules are important for the premium tax credit. For example, let’s look at Bob, who is caring for his uninsured mother, Marie. Bob provides more than half of Marie’s support and Marie has no income. Marie qualifies as Bob’s dependent. He wants to enroll Marie in a marketplace plan, but Bob’s income is too high to qualify for marketplace subsidies. Even if Bob chooses not to claim Marie as a dependent on his tax return, Marie is not eligible to claim her own personal exemption on a separate tax return. Because Marie qualifies as Bob’s dependent—whether or not he claims her on his tax return—she cannot qualify for PTC on her own. If Marie applies for health coverage on her own, and at tax time she attempts to file a separate tax return, she will be found ineligible for PTCs and any advance payments of the PTC she received during the year will need to be repaid, up to the cap. If instead, Bob claims Marie as a dependent at tax time, any APTC Marie received during the year will need to be reconciled on Bob’s tax return based on his income."

http://www.healthreformbeyondthebasics.org/question-of-the-day/

[nepusa 0]

To be a dependent, one should not have an annual income of more than $4000.

Let's say, if parents, have income of >$4000 from their native country, then they cannot be claimed as dependents by their adult son/daughter even the parents are living with them. In this situation, I think, adult son/daughter's income does not need to be included in the total income of the parent.

Another scenario-what if parents say that they pay their adult son/daughter for accommodation? That way, the son/daughter is not paying for at least half of their expense, which is one of the pre-requisite for someone to be called dependent.

[NigeriaorBust 4,087]

Are you saying the parents should lie to the US government ? Why would we want immoral people to immigrate to the US ?

[Umka36 781]

I'm not here to advise anyone to lie/cheat on their taxes. Those that do and get caught won't get any sympathy from me.

[nepusa 0]

To be a dependent, one should not have an annual income of more than $4000.

Let's say, if parents, have income of >$4000 from their native country, then they cannot be claimed as dependents by their adult son/daughter even the parents are living with them. In this situation, I think, adult son/daughter's income does not need to be included in the total income of the parent.

Another scenario-what if parents say that they pay their adult son/daughter for accommodation? That way, the son/daughter is not paying for at least half of their expense, which is one of the pre-requisite for someone to be called dependent.

Are you saying the parents should lie to the US government ? Why would we want immoral people to immigrate to the US ?

Are you saying the parents should lie to the US government ? Why would we want immoral people to immigrate to the US ?

Hey Buddy,

I am not saying parents should lie. I was asking hypothetical questions. I do not even have my parents in US and they do not even plan to migrate to US.

My friend and his parents won US DV(Diversity Visa) recently and asked me about health coverage for his parents. He is not sure if his parents too should come with him to US.

Regarding, my first scenario about parents having more than > $4000 income- Many immigrants, not necessarily everyone, have at least some income from their native country e.g. house rent, shares etc. If they actually have > $4000 annual income from their native country, will it be immoral to say that they do have >$4000 annual income? May be they can show proof too, e.g contract papers with the tenants.

Regarding the second scenario-I agree this sounds like a lie. I apologize. It is true that, ethically, it may sound wrong for parents to pay their adult children to live in their chilren's home. I was curious about the legal part. Is it wrong legally for parents to pay their children to live in children's house? What if the parents actually pay their children?

Let's assume immigrant parents are desperate to live with their children in US, also want their own health insurance coverage and do not want their children to pay hefty amount for their insurance. May be in such scenario, they can consider to pay their children( I mean actually pay children and get signed papers).

[Umka36 781]

Hey Buddy,

I am not saying parents should lie. I was asking hypothetical questions. I do not even have my parents in US and they do not even plan to migrate to US.

My friend and his parents won US DV(Diversity Visa) recently and asked me about health coverage for his parents. He is not sure if his parents too should come with him to US.

Regarding, my first scenario about parents having more than > $4000 income- Many immigrants, not necessarily everyone, have at least some income from their native country e.g. house rent, shares etc. If they actually have > $4000 annual income from their native country, will it be immoral to say that they do have >$4000 annual income? May be they can show proof too, e.g contract papers with the tenants.

Regarding the second scenario-I agree this sounds like a lie. I apologize. It is true that, ethically, it may sound wrong for parents to pay their adult children to live in their chilren's home. I was curious about the legal part. Is it wrong legally for parents to pay their children to live in children's house? What if the parents actually pay their children?

Let's assume immigrant parents are desperate to live with their children in US, also want their own health insurance coverage and do not want their children to pay hefty amount for their insurance. May be in such scenario, they can consider to pay their children( I mean actually pay children and get signed papers).

My short answer to your question is that you/your friend's elderly parent should report all income from oversea assuming they meet the filling threshold. Don't under report income in order to maximize the amount of PTC you can claim, because it not just unethical but illegal. On the other side of the coin don't lie and make up an income amount, so they meet the income threshold from being considered a dependent.

Personally I wouldn't recommend your second scenario. It's just spews of a reason for the IRS to audit you.

I still recommend consulting with a qualified tax advisor for your hypothetical questions, since the outcome may be severe if you do it wrong.

[Avi85 1]

I discovered this thread as I am in a similar situation. I did a tremendous amount of research but unfortunately, there isn't a lot of clear information available that caters to people in this situation, forcing many us to make risky assumptions.

I found this article on healthcare.gov website which might be interesting to some of you:

https://www.healthcare.gov/immigrants/lawfully-present-immigrants/

In this article, the part I would like to highlight is:

"Applying for Medicaid or CHIP, or getting savings for health insurance costs in the Marketplace, doesnt make someone a "public charge." This means it wont affect their chances of becoming a Lawful Permanent Resident or U.S. citizen."

From this article, I can conclude that while receiving subsidies on the health insurance premiums for one's parents would not breach support agreement with USCIS, I am yet to find out if the parents in this situation can file a zero income return. What I did find, however, is that parents can be claimed as one's dependents for tax purposes, only if:

1. The sponsor is providing more than 50% of parents' total support.

AND

2. The parents made less than $4050 in 2016 (IRS revises this amount every year).

Source:

https://turbotax.intuit.com/tax-tools/tax-tips/Family/Rules-for-Claiming-a-Dependent-on-Your-Tax-Return/INF12139.html

While #1 is straightforward, #2 isn't as much. The IRS encourages (I want to say required but I am not certain) a tax filer to provide a breakdown of their worldwide income. If one's parents are residents of the US but receiving income in forms of pension or annual dividend on other investments totaling more than $4050 in 2016, they cannot be considered as dependents and according to IRS, they will be required to file a tax return on their own. Theoritically, they could use that tax return to receive a subsidy in the health insurance, which according to ACA, would not be considered against the affidavit of support.

Feel free to share your thoughts. I am not trying to find any loopholes. All I am interested in is to get a clear understanding of the law to help me make a right decision. Since all the officials that I spoke with and the websites I navigated through seem to give conflicting information, there isn't a lot of credible resources available for people in this situation. If any of you find more reliable information, please do share.

And to the original poster, a big thank you for starting this thread.

[databit 328]

From the FedGov:

If your parents file their own joint taxes, to receive an ACA subsidy their income must be a minimum of $22,108, up to a maximum of $40,050 for 2017 for 2 married people in Illinois.

If they file as zero income, they will not qualify for ACA, which was designed for working people. Plus you will lose your potential tax deduction for them. But on the other hand, if you make them part of your household, thus placing them in your income bracket, they may not qualify for Medicaid.

https://www.healthcare.gov/lower-costs/qualifying-for-lower-costs/