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Covered California and Obamacare related questions from consumers, employers and agents are answered by Phil Daigle with the best information available at the time. Archived entries may no longer be accurate as the Covered California and Obamacare knowledge-base is evolving quickly. TO REQUEST A PERSONAL RESPONSE INCLUDE EMAIL ADDRESS.


No Prior Tax Returns?

By on | 8 Comments

Question: My daughter has not made sufficient income to be required to file tax returns. She is enrolled with a plan but has received a Covered California request for a copy of her W-2 or prior tax return, her birth certificate and social security card. We have the card and birth certificate. How do we respond to the request for proof of income?

Answer: I'm surprised they didn't ask for her high school transcripts? I mean, these CC requests for verification are wildly off the mark. Here's the scoop. You have 90 days to comply. Wait until you can get through to CC on the phone without waiting 30 minutes or more to talk to someone - probably another month. Once you can conveniently talk a CSR, he or she will sort out what you really need to provide and tell you how to submit it. They will also remove the unnecessary requirements from your account. As for your daughter not filing taxes in the past, that's not a requirement. She only has to agree to file taxes for the 2014 tax year and beyond.

8 Comments

If you sign something under penalty of perjury, then it is an affidavit for purposes of California law. (Technically, it’s a “declaration” only unless it is notarized — but California law treats the “declaration” the same.)

The magic words are simply to write, “I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct” — and then sign and date your statement.

Andy …

As a consultant/expert witness to attorneys in insurance bad faith litigation, I certainly understand and appreciate what you are saying. Covered California, as anyone who has dealt with them will tell you, seems to make up its own rules as it goes along.

But apparently you’ve never had to upload such a document that explains one’s income situation to Covered California or been given instructions by one of their CSRs to do so.

“Statement” is not one of the document choices. Just like “Social Security Benefit Statement” is not one, and I have to check “Other document to show proof of unearned income” even though Social Security is one of the recognized sources of unearned income on that part of the application.

The whole document upload situation is a mess. And I discovered this about five applications into the process, when a document request was issued to provide proof of income for a 6-month old child. Really!

The CSRs will tell a person, like they told me, “Just write a statement that explains the situation, and submit it as an affidavit.”

That’s the only “document type” that makes any sense in the list of acceptable documents.

Is a handwritten statement the same as an affidavit in a California courtroom. No. But Covered California is not a courtroom either.

Andy’s advice may be well-intentioned but is highly misleading to the typical Covered California enrollee who has been asked for proof of income.

Most enrollees only need to furnish the requested proof of income and then WAIT until Covered CA makes their decision on the acceptability of the submitted proof. While you are waiting for their decision, your advanced premium tax credit (APTC) and cost-sharing reduction (CSR) will continue. And even though you are initially advised that the APTC and CSR are conditionally being provided for 90 days, your APTC and CSR will continue beyond 90 days if Covered CA has not yet made a decision. This conditional provision of APTC and CSR beyond 90 days is clearly spelled out in the regulations.

Enrollees should monitor the “Secure Mailbox” on their Covered CA accounts for this decision on proof of income. I would advise checking this mailbox perhaps once a week even prior to the expiration of the 90-day period, but definitely check more often once the 90-day period has expired. (I believe the regulations require a snail-mail notification as well for such decisions, but checking the online mailbox provides an extra measure of safety to make sure you are aware of the decision as soon as possible.) You can also monitor the progress on your account’s Manage/Submit Verifications page, but this should be unnecessary since you should get a notice along with any decision.

If Covered CA indicates that your proof of income is acceptable, great. They should send you a notice that you are now approved for APTC and CSR beyond the original 90 day period.

If they indicate that your proof is unacceptable, they may notify you that you need to provide additional proof along with the deadline for submitting such proof. Your APTC and CSR will continue while they await your compliance and while they make their decision on your additional proof. Again, this ongoing provision of APTC and CSR is clearly spelled out in the regulations.

Finally, Covered CA may inform you that your proof is unacceptable and therefore your APTC and CSR will be reduced or eliminated as of a certain date (1st of the next month, unless the decision is made after the 15th, in which case the effective date will be the 1st of the month AFTER the next month). Any such adverse decision must tell you of your right to appeal the decision. You should then appeal the decision until you are able to convince Covered CA. Your APTC and CSR continue during the appeal process, and again this is clearly spelled out in the regulations.

I don’t wish to guess how Andy got himself into his current quandary, but if he is the same “Andy” who has commented on proof of income matters in the past, his problems may have begun when he insisted on having his proof reviewed prior to the 90-day expiration (see his December comments on the blog entries “Why Haven’t I Heard from Blue Shield?” and “CC Application Pending?”). This came at a time Covered CA had its hands full simply processing incoming applications and likely had no administrative procedure in place to verify proof of income (because the earliest date for taking action on conditional APTC/CSR cases was not until 2/1/14 or even 3/1/14). I don’t know what procedure may have been improvised in his case but it is not necessarily anything close to what others will experience once Covered CA starts processing its proof of income backlog in earnest.

And just to be clear, please ignore Andy’s comments that:

“… uploading your doc into your account is meaningless unless it is opened or ‘verified’ by a rep. You must call up and ask them to do it, otherwise it could sit in your queue forever unseen.”

These comments are well-intentioned advice but indicate a lack of awareness of the regulations. There is no need to rush Covered CA into moving the process along, because your APTC and CSR will continue as is as long as they do nothing. Let Covered CA take as much time as they want in making their decision - just be prepared to act if necessary once they notify you of the decision.

btw Max, a statement called “Affidavit” is just that - a statement. At best the kind of document you’re describing could be considered a Declaration. But it is not an Affidavit.

Does it matter as regards Covered CA? Hopefully not, probably not. But when representing a client, especially where you might have some fiduciary responsibility, and a governmental entity asks for an Affidavit, it’s best to assume they’re not using that term as a catch-all for anything you throw on paper. An Affidavit has specific legal connotations, and not just in court testimony.

If anyone is interested, please refer to “The California General Affidavit and Guide” for more specifics.

To obtain a 2014 Premium Tax Credit:

A) It is not a requirement to file a 2013 federal income tax return.

B) It is not a requirement to have filed a 2012 income tax return.

C) It is a requirement to file a 2014 federal income tax return on or before April 15, 2015.

But that’s not even the answer to the original question, which actually misstates the request from CoveredCA. The request is for “PROOF OF INCOME” — what the OP posted were some of the acceptable proofs, not the required documentation.

In the case of a person with no income, like a child, you simply write and sign a statement titled, “Affidavit”, that says something like: “Angela Smith is my daughter and she is a high school student. She has no income in 2013, and is not expected to have any income in 2014.”

You choose “Affidavit” in the list of documents for upload, and upload that statement. End of discussion. I’ve done this on probably 20 applications through CoveredCA where one or more of the applicants was under age 18 (twice under age 1). The system that evaluates answers in the application has not been properly programmed to deal with children who have no income.

In about six months (if ever), someone may actually look at the affidavit and say, “Oh, yeah, another one of those.”

With all due respect again - and Steven I see you’re an insurance/tax professional - but at this point your strategy is heavily over-weighted with risk and no additional reward beyond a little time and money.

We are beyond the wait and see how this thing is going to work period. In fact, we are entering the danger zone and only beginning to see the results of the avalanche of 90 day conditionals issued in October and November coming to an end.

In this specific case, the daughter is enrolled and her previous attestation, which according to the way it was set up should have been enough, is proving not. A simple redeclaration again will likely not be sufficient. A W2 is something, if she even has one, but in the hierarchy of documents, NOTHING trumps the 1040. It conclusively ends the income argument. Lat year it wasn’t an option, but since 1/31 it is. USE IT.

Also, it is known by now that just uploading your doc into your account is meaningless unless it is opened or “verified” by a rep. You must call up and ask them to do it, otherwise it could sit in your queue forever unseen. This is not conjecture at this point.

The APPEAL process is the strongest weapon in our arsenal now, and we must share with each other and learn how to use it immediately and effectively. The bottom line - if you’re already enrolled in a plan, don’t let your guard down and take it for granted if you’re being challenged. You must DEFEND it aggressively. That includes SS number challenges, which are very serious and not just minor glitches in the system. They potentially indicate a disconnect between how your name is spelt on your SS card and how it shows up on your Covered CA application. My understanding is recent rollouts of the website pick this up and make an issue of it whereas the system did not when it first came out.

Sorry Phil for the long rebuttal but I’m not writing this to win a pissing match. Feel free to not post this and just absorb it for yourself, or edit it as you see fit. The 90 day resolutions are tricky, they’re causing terminations/re-applications, and understanding how to navigate through this part using the Appeal Process is really really important.

I do not believe the daughter needs to file a year 2013 tax return to meet the proof of income request from Covered CA if her year 2013 income was, in fact, below the filing threshold requirements (less than $10,000 if single and less than $6,100 if single and a dependent).

The Advanced Premium Tax Credits (“APTC”) and Cost Sharing Reductions (“CSR”) are based on projected year 2014 income and available to Eligibles who promise to file a year 2014 tax return.

I suggest responding to the proof of income request with a current check stub or letter of explanation illustrating that the daughter is on track to earn the income that was reported within the enrollment application. I also suggest you consider Phil’s answer as I agree that some requests from Covered CA are “off the mark” and the queue time to talk to a service rep often exceeds 30 minutes.

Respectfully to Phil, but I couldn’t disagree more if I was paid to. Instead, I recommend that you do the following. This is all based on painful firsthand experience. Expect massive incompetence and BE PROACTIVE.

(1) Buy TurboTax and file a return for her for 2013. Now. Yes, I know she doesn’t have to. A 1040 is the definitive proof of income, or LACK OF in your daughter’s case. Get that data in the system; it will make her life easier for years to come. (2) In 24-48 hours, you’ll get an email through TurboTax stating the Fed has received the E-filing. (3) Scan the 1040 (page 1), the email, the birth cert, and the SS card. (4) Create a cover letter (with the Case Number) referencing all this and state your daughter will make the same income for 2014. (5) Get the APPEAL paperwork off the Covered CA site, fill it out, and scan all of these documents mentioned into one PDF. (6) Email the pdf to the Dept of Social Services and upload the pdf to your Covered CA account. (7) Call Covered CA, wait as long as you have to, and ask the person who answers to verify that that they can open the uploaded pdf. Tell that person to note on your account that you have filed an Appeal.

Do these steps and you will get a call from the Research and Resolution Department within days. These are the workers who can make your troubles go away - NOT the front line who answer the phones.

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