January 25, 2008

Filing taxes under the Massachusetts Health Care Reform Act

Beginning with the 2007 tax year, the Massachusetts Health Care Reform Act requires all Massachusetts residents to show proof of health coverage when filing their state taxes. Individuals who do not provide proof of insurance may receive a tax penalty.

The new 1099HC form
Employees with private health insurance — either through the MGH or another source — will receive a new tax information form called the 1099HC directly from their health insurance carrier, which will be mailed by Jan. 31. It is important for employees to keep this 1099HC form, as it contains information needed to complete the Massachusetts state tax return and show proof of health insurance coverage. Employees who have not received the 1099HC form by Jan. 31 should contact their health insurance carrier. Individuals participating in government subsidized health coverage such as Commonwealth Cares or Medicare will not receive an HC1099 form.

Completing state tax Schedule HC
Using the information from the 1099HC form, employees should complete and file Schedule HC-Health Care Information on the 2007 state tax form (Massachusetts Form 1 or Form 1-NR/PY). Individuals who have health insurance coverage will need to complete only the first page of Schedule HC, and employees who can answer "yes" to Question 1 and complete Question 2 or 3 on Schedule HC will fulfill the Health Care Reform Act's requirements.

Schedule HC and instructions for completing it are available at www.mass.gov under the "For Residents" tab by clicking "Health," "Health Care Reform" and then "Health Insurance Tax Benefit." Online filers should find electronic versions of this information in their tax package. A virtual tour of Schedule HC is available at www.mass.gov/dor.

Tax penalties for 2008
Failure to have health insurance will result in higher penalties in 2008. Residents will pay a penalty for each month without coverage. Depending on income level and age, the penalty can range from $210 to $912 for an entire year without coverage.
For more information about filing taxes under the Massachusetts Health Care Reform Act, contact the Partners Benefits Office at (617) 726-8133 or ibenefits@partners.org. Monthly paid staff can contact the MGPO Professional Staff Benefits Office based on the following:

Last names A-G
Jennifer R. Williams
(617) 726-9264, rwilliams@partners.org

Last names H-O
Linda Gulla
(617) 726-9266, lgulla@partners.org

Last names P-Z
Virginia Rosales
(617) 724-9356, vrosales@partners.org