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Last year I used the marketplace (healthcare.gov) to get health insurance for myself (F1) and my dependents (F2). Based on the information and documents I provided, they found me eligible and gave my APTC toward my premium payment (for the duration of 2022).

Now, when I am filing my taxes (through sprintax) they are telling me that I (as non-resident alien) am not eligible to receive APTC and I need to pay back the amount I received. If that is so, then why they gave me that in the first place.

I am student and I have a fellowship that pays my tuition, stipends, and cover expenses for my dependents.

As tax expert, what do you think? I am not able to pay all that amount at once - if I have to do it. What should I do or …?

I know someone who know someone which have the same legal status like me, however someone helped him to file his taxes claim thousands of $$. How can be such a difference between my case and his.

Sorry for dummy question, any help is appreciated. Thanks

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  • Does sprintax have an option to show (or print) the paper forms? (I don't use it, but the other tax-prep programs I have used all did.) If so check those against the IRS's instructions especially form 8962 (as I referenced in other comment). It's possible you missed something in the 'interview' or even the software has a bug. ...
    – dave_thompson_085
    Commented Mar 12, 2023 at 3:59
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    OTOH if you really do owe, for any tax debt under $50k (and I can't imagine one year's APTC being that much) you can automatically get an installment plan for up to about 5 years (for a small fee if you do it online, with their normal interest currently 7% and half the standard FTP penalty = 3%). See the IRS website under 'payments' -- but only after you've checked out whether you really owe.
    – dave_thompson_085
    Commented Mar 12, 2023 at 4:00
  • I received this from sprintax team: "Non-residents usually cannot claim dependents, this is why you need to pay by sending money to the IRS or online."
    – Mohammad Hassany
    Commented Mar 12, 2023 at 5:38

2 Answers 2

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Adding after reading this in your comment:

I received this from sprintax team: "Non-residents usually cannot claim dependents, this is why you need to pay by sending money to the IRS or online."

The problem is not with APTC, but with the fact that you are trying to claim a dependent while being a non-resident. Your spouse should file their own individual tax return. Unless there's a treaty provision that allows you to file MFJ, you must each file individually as MFS on your 1040NRs. You cannot claim dependents.

See the instructions for 1040-NR:

Exception.

Only U.S. nationals and residents of Canada and Mexico can claim a dependent on the same terms as U.S. citizens. Residents of South Korea and students or business apprentices from India who are eligible for the benefits of Article 21(2) of the United States–India Income Tax Treaty may claim dependents on the more limited terms described in chapter 5 of Pub. 519. No other person filing a Form 1040-NR can claim a qualifying dependent.

original answer below:

Generally lawfully present aliens are eligible (see here), and that includes students.

However, eligibility has additional components. For example, if you're eligible for a different type of subsidized coverage (Medicare or Medicaid) then you're expected to use that and not the marketplace. So, for example, if your income is below the 100% Federal poverty limit ($18310 for a family of two in 2022), then you cannot claim APTC because you're expected to be on Medicaid. You can still claim APTC if you're barred from Medicaid due to your immigration status. AFAIK, this is only true for family-based new immigrants in their first 5 years in status.

Additionally, if you already have coverage through your university (which I expect you do, or at least should, as a condition for your visa) then you cannot claim APTC because you're basically double dipping.

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  • Form 8962 instructions state the relevant exemption (from 100%FPL floor) as 'alien lawfully present' not green card (which is 'lawful permanent resident'); see irs.gov/instructions/i8962#en_US_2022_publink100077021 . I don't know of any legal requirement for the school to offer insurance to foreign students unless they are also employees (and the school has 50 FTEs, but it would be impractical to meet Education standards with less).
    – dave_thompson_085
    Commented Mar 12, 2023 at 3:48
  • @dave_thompson_085 you're right, I misread Medicaid for Medicare... Re the legal requirement - it's not a legal requirement, but most universities require it in order to be accepted as international students.
    – littleadv
    Commented Mar 12, 2023 at 7:35
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    @MohammadHassany+ unfortunately that's right; you can get PTC for spouse only if filing joint, which NR can't, and for dependent(s) only if allowed to claim (I forgot this part), which most NR can't; again in 8962 .
    – dave_thompson_085
    Commented Mar 13, 2023 at 2:46
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    @MohammadHassany it doesn't. Until this proposal is picked up by the Congress and is enacted and signed by the President into law it means nothing. I don't expect the current Congress (with the Republican-controlled House) to allow subsidies for non-residents that were not originally allowed in the ACA that they've been trying so hard to kill entirely.
    – littleadv
    Commented Mar 13, 2023 at 16:10
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    @MohammadHassany all the APTC that you received is your APTC since you're the main policy holder. If I understand correctly, you have one coverage that includes your whole family, with you as the main insured and everyone else your dependents. So everything is on you and you need to repay all the subsidies you got. Unless your wife and your child each have a completely separate coverage with absolutely no relationship to you (which is not what you described), neither of them owes anything or got anything - it's all you.
    – littleadv
    Commented Mar 13, 2023 at 16:15
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Answer to my question:

To find answer to this situation, I checked with tax experts, called IRS, and finally to be on the safe side, although my wife didn't have any income, I filed a tax return and paid the due amount for her. I also filed my taxes with the information from 1095-A form.

Fast forward to August, IRS returned the amount I paid as the tax for my wife and responded with a letter that she doesn't need to file a tax.

Based on what I learnt from last year, I only filed taxes for myself.

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