Returns Rejected for Missing Premium Tax Credit Form

On March 22, 2022, the IRS posted an update on its filing season alerts page that addresses rejected e-filed returns that are missing Form 8962, Premium Tax Credit. Form 8962 is used to reconcile advance payments of the premium tax credit (APTC).

New IRS policy

Before 2021, the IRS did not reject tax returns that were filed without a required Form 8962. Instead, after receiving the return, the IRS would write to the filer to request the form or a written explanation of why the form was not attached to the return.

However, for the 2021 tax year, the IRS is rejecting e-filed returns when a taxpayer is required to reconcile APTC payments on Form 8962 but does not attach that form to their tax return.

Note. The IRS will follow its pre-2021 policy for paper filed returns. After the IRS receives a paper return that is missing a required Form 8962, it will write to the filer to request the missing form or an explanation for its absence.

Who needs to file Form 8962?

Generally, taxpayers who get their health insurance coverage from a "Marketplace" or an "Exchange" and get help to pay their insurance premiums via APTC must reconcile the amount of that APTC they received with the amount they were entitled to. If the taxpayer's e-filed return is rejected because Form 8962 is not attached, the taxpayer should review their health insurance records, including Form 1095-A, Health Insurance Marketplace Statement. A taxpayer who was covered by Marketplace health insurance during 2021, even if only for part of the year, and those who terminated coverage at the end of 2021, still must reconcile their APTC on Form 8962.

How to correct the rejection and resubmit the return electronically

The rejected return may be resubmitted electronically once the missing Form 8962 is completed and included in the return or a written explanation of why Form 8962 is absent is attached to the return. For more information, see How to correct an electronically filed return rejected for a missing Form 8962.

Note. According to the IRS, resolving the missing Form 8962 issue at the time of filing, instead of through correspondence, will avoid processing delays that occur when the IRS needs to correspond with the taxpayer regarding the missing form.