What can you do if advance payments of the premium tax credit (APTC) were discontinued because you didn’t file income taxes?

Guidance on Failure to File and Reconcile (FTR) operations for Plan Year 2023: 

Early in the new year following Open Enrollment (OE), the Marketplaces that use the federal eligibility and enrollment platform will typically perform a recheck of Internal Revenue Service (IRS) data to verify whether those who attested on the application filed and reconciled previous year’s Advance Payments of the Premium Tax Credit (APTC) amounts. The Centers for Medicare & Medicaid Services (CMS) will not run FTR Recheck in Plan Year 2023. CMS will not act on data from the IRS indicating that consumers who have failed to file tax returns and reconcile a previous year’s APTC with the premium tax credit (PTC) allowed for the year. This change was made in response to the impact of the Coronavirus Disease 2019 (COVID-19) Public Health Emergency on the processing of federal income tax returns and changes. This means CMS will not send FTR warning notices, such as the FTR Direct Warning Notice, when enrollees have an FTR status, and CMS will not take action to terminate APTC for Plan Year 2023 for enrollees who have an FTR status due to failing to file and reconcile APTC in tax year 2021.

In plan year 2023, State-based Exchanges (SBEs) may also elect not to act on data from the IRS indicating consumers have failed to file tax returns and reconcile a previous year’s advance payments of the premium tax credit (APTC) with the premium tax credit (PTC) allowed for the year. Read more about this guidance.

Even though FTR operations are paused for plan year 2023, your clients are still required to file their federal income tax return and reconcile any APTC previously paid on their behalf using the Internal Revenue Service (IRS) Form 8962 for each year they receive APTC.

If an enrollee’s APTC and income-based cost-sharing reductions (CSRs) are discontinued after they or their tax filer failed to file a federal income tax return and reconcile APTC paid on their behalf in the previous year, they will remain enrolled in Marketplace coverage but without financial assistance. Learn more about failing to file and reconcile.
 
Individuals whose APTC has been discontinued to file their federal income tax return as soon as possible and complete Form 8962 to reconcile any past year APTC that was paid on their behalf to regain eligibility for APTC and CSRs.
 
Once your their tax filer has completed these steps, they should return to their Marketplace application and attest to having filed and reconciled. If you have already filed their Form 8962 and it has not yet been processed by the IRS, they can also return to the Marketplace and attest that they have filed and reconciled to receive APTC again. Enrollees who had already filed and reconciled before their APTC was discontinued can file an appeal and request to receive APTC while their appeal is being processed. Information on how to request an appeal can be found in the updated eligibility determination notice enrollees receive when their APTC is discontinued.