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To keep health care subsidies, residents must file federal tax returns

State officials and consumer advocates are reminding Massachusetts residents with subsidized health insurance coverage to file their tax returns before April 19 -- or risk losing their federal tax credits.

For the first time this year, 174,000 people in Massachusetts who receive tax credits to offset the cost of their health insurance must file a tax form to prove they were eligible for the credits. Those who don’t file could be forced to pay back their tax credits or lose eligibility for credits in future years. Tax credits are available to help individuals and families with low or moderate income pay for health coverage.


Many people who have never filed a tax return because they don’t make enough money will have to file this year, state officials and consumer advocates said. Typically, individuals who make less than $10,300 do not need to file federal tax returns.

But this year they must file if they earn less than that amount but receive subsidized health coverage, under the federal Affordable Care Act.

“This is a change in the law, and it’s really important that people pay attention to filing this year,” said Amy Whitcomb Slemmer, executive director of the Boston consumer advocacy group Health Care For All. “The concern is that if someone does not file taxes, they may in fact be liable to pay back tax credits because they will not have demonstrated through their tax filings that they qualified for them. We don’t want anybody to be liable when they shouldn’t be.”

Louis Gutierrez, executive director of the Massachusetts Health Connector, said the agency mailed notices to remind people receiving subsidized health coverage that they must file tax returns. About 45,000 people who buy insurance on the Connector, but do not receive tax subsidies are not affected by the rule.


Volunteers are available to help people file their tax returns. Anyone looking for assistance can call the Internal Revenue Service hotline at 800-906-9887.

The new tax rule actually went into effect last year, but because the Health Connector broke down and state officials pushed thousands of people into temporary Medicaid coverage, which is fully paid by the government, the rule affected few people.

The Affordable Care Act requires all individuals to obtain health insurance. Those without insurance must pay a penalty.

Priyanka Dayal McCluskey can be reached at priyanka.mccluskey@globe.com. Follow her on Twitter @priyanka_dayal.