"Filing my taxes was simple and easy to do"
by Dale Bellis, Executive Director
April 15th is just around the corner. The urgency to get your taxes done is building! The 2014 tax year is the first year in which being uninsured will cause individuals and families to be penalized. Taxpayers without health insurance will have to pay a "Shared Responsibility Payment." However, members of Liberty HealthShare are exempt from this additional tax during the months in which their membership is active.
Whether you complete your taxes online or on paper, remember that, as members of a health care sharing ministry, you are not subject to the “tax” penalty imposed for not having health insurance.
Like every other member, since this was my first experience filing my taxes under the new law, I was uncertain about how complex it would be. I was pleasantly surprised when I saw the option to mark "HealthCare Sharing Ministry" as on option for exemption within the tax filing software that I use (TurboTax). The process was simple. The Turbo Tax software filled out Form 8965 based on the questions I answered, and the process was complete in just minutes. I was pleasantly surprised at how uncomplicated it was!
For those using tax preparers, or filing taxes on paper, this is the information you need to know:
On line 61 of the 2014 Form 1040, taxpayers are asked to report the amount of the "Shared Responsibility Payment" owed. If you claim an exemption from the tax as a member of a healthcare sharing ministry, that exemption is reported on Form 8965. Any day of a month in which a person was exempt applies to the entire month. In other words, if you became a member on June 28th, you are considered exempt for all of June.
The IRS Instructions for Form 8965’s Worksheet just asks for the code under which you are exempt. As a member of a healthcare sharing ministry, you have a "Code D" exemption. Your tax return does not ask for the name of the exempt healthcare sharing ministry. In the event that your accountant or tax preparer asks for the name of the recognized HCSM through which you share medical bills, the formal name of our Health Care Sharing Ministry is "Gospel Light Mennonite Church Medical Aid Plan, Inc." Liberty HealthShare is a ministry of that entity.
On Form 8965, leave parts I and II blank and skip directly to part III. In the column labeled "Exemption Type", for each person in your household to whom it applies, you will simply writ the letter "D" for each month in which you claim the exemption.
For example, if you had insurance from January 31st to June 1st and then participated with Liberty HealthShare from July 1 to the end of the year, the amount owed on Line 61 of Form 1040 would be $0 (Zero).
Follow these basic steps:
Step 1: Calculate your "Shared Responsibility Payment" on Form 8965.
Step 2: Claim the months that you were a part of a healthcare sharing ministry as an exemption in Part III of Form 8965 using code ‘D’.
Step 3: Report on line 61 of Form 1040 the "Shared Responsibility Payment" which was calculated on Form 8965.
You or your tax preparer should have no trouble accessing the forms referenced above. If you have questions, the Liberty HealthShare team is here to help you! Contact us anytime at Info@libertyhealthshare.org or 855-58-LIBERTY