Receive an Obamacare Subsidy? Surprise! You May Owe Money to the IRSLily Dane 6.8 MILLION people received those subsidies under the ACA in 2014. A nasty surprise is in store for about half of those people an estimated 3.4 million Americans when they file their taxes. Thats because OOPS they received subsidies that were too generous. This means that the people impacted will either receive smaller tax refunds than they expected, no refund at all, or will actually OWE the IRS money. Last Thursday, the Wall Street Journal reported that the tax preparation firm HR Block did some number crunching and came up with the disturbing calculation: The reason this is happening (aside from the ACA being a seriously flawed policy in just about every way) is because the subsidies are based on PAST income. In other words, taxpayers got their subsidies prior to knowing exactly what their total income for 2014 would be. They had to estimate their income for the year when they signed up for insurance months ago enrollments for 2014 began in October 2013. Many people didnt know exactly what theyd earn in 2014. Experts say some guessed based on their income as far back as 2012. And we arent talking pocket change here, as Tami Luhby of CNN Money explains: Those who underestimated their earnings could owe thousands of dollars, though there is a $2,500 cap for those who remain eligible for subsidies. The threshold for eligibility is based on income $45,900 for an individual and $94,200 for a family in 2014. To add insult to injury, subsidy recipients will have to complete the mind-boggling IRS form 8962. To do this, they will use information on their insurance, subsidies, and income that will be supplied to them on Form 1095-A, which they should receive from their exchange by January 31. If they were not enrolled in Obamacare for the entire year, they will have to break down the subsidy payments by month. Heres what that form looks like: Also concerning is whether the Form 1095-As will contain accurate information and whether the exchanges will send them by the end of January, said Jost, who writes about Obamacare for the Health Affairs blog. Oh, remember when someObamacare navigators were caught telling applicants to lie about their income to get more subsidies and lower premiums? No one is sure how often that happened, but if people actually took that advice, they may end up paying dearly for it. But all of this may not matter much come March, when the Supreme Court will decidewhether the subsidies issued to residents of states that did not set up their own Obamacare exchanges are legal at all. Obamacare Architect Extraordinaire Jonathan Foot in Mouth Gruber said it himself: Some are promising to do what they can to repeal Obamacare and replace it with affordable, free-market options. One notable politician who is working to do just that is Mia Love, a Republican member of the U.S. House of Representatives from Utah who assumed office on January 3: Lets hope that by some miracle, the ACA is repealed as soon as possible, because premiums and penalties are going to increase significantly in 2015. 