Some Non-U.S. Citizens Are Exempt from the Individual Shared Responsibility Payment

October 5, 2015

Be Sure to File IRS Form 8965 to Claim Your Exemption

The Affordable Care Act made it a requirement for individuals to have health care coverage, or if they don’t, make a shared responsibility payment – but some groups of people are exempt.

If you live in the United States but aren’t a U.S. citizen, U.S. national, or lawfully present immigrant, you aren’t required to have health care insurance or make a shared responsibility payment.

To prove you are exempt from having to make a payment, you should complete IRS Form 8965, Health Coverage Exemption Form, and attach it to your regular federal tax return.

You need to fill out Part III - Coverage Exemptions for Individuals Claimed on Your Return. Enter your name, Social Security number or individual taxpayer identification number (ITIN), and a code for your exemption.

The exemption code “C” covers certain U.S. citizens living abroad and certain types of noncitizens, including non-resident aliens and non-citizens who are not lawfully present. (A full list of codes is available in the instructions for IRS Form 8965)

IRS form 8965

Please Note: The IRS will not use the information you provide about yourself or your dependents for immigration enforcement purposes.

What if I already filed my tax return?

If you already filed a federal income tax return that incorrectly shows you, your spouse, or any of your dependents owing the Shared Responsibility Payment, you can amend your tax return since you are eligible for the exemption.

When you submit your IRS Form 1040X, Amended U.S. Individual Income Tax Return, you should include the Form 8965 to prove you are exempt.

A note about possible scams

The IRS has issued warnings about a scam where tax preparers ask their clients to make individual shared responsibility payments directly to them instead of the IRS. If this has happened to you, you may be a victim of return preparer fraud and need to file a complaint against the preparer with the IRS. - Affordable Care Act Consumer Alert: Choose Your Tax Preparer Wisely

Other Resources: – Individual Shared Responsibility Provision Exemptions - More information for immigrant families - Coverage for lawfully present immigrants