ObamaCare credit reduced taxpayer refunds: H&R Block

Roughly two out of every three taxpayers who got health insurance through ObamaCare exchanges had to pay back the federal government – to the average tune of $729, according to H&R Block. 

That payment ate into the average taxpayer refund by roughly a third, the tax preparer said in a Monday release. Taxpayers owed money if the government gave them too much of a tax subsidy to help pay for insurance.

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The news wasn't all bad for taxpayers though, H&R Block said. About one in four taxpayers deserved a higher tax credit from the government for insurance, and got an extra $425 on average.

Mark Ciaramitaro of H&R Block said those sorts of results were to be expected, given the complexity of the Affordable Care Act. Ciaramitaro, the vice president of healthcare and tax services for H&R Block, said problems are also likely to continue into the 2016 tax filing season.

"Our figures highlight the importance of estimating income as accurately as possible when applying for premium tax credits and notifying the Marketplace with any life changes that impact annual household income or size," he said.

This filing season marked the first time that taxpayers who received insurance through the ObamaCare marketplace had to reconcile the amount of tax credits they received with an earlier estimate of their income. 

John Koskinen, the IRS commissioner, has heaped praise on his agency's handling of the first ACA tax season. The IRS chief has said that implementing ObamaCare meant less money for other priorities, like assisting taxpayers on the phone, and has pleaded with Congress to stop cutting his agency's budget. 

At a hearing this month, Koskinen estimated that about 55 percent of taxpayers dealing with the ObamaCare exchanges owed the government after underestimating their income. The other 45 percent, he projected, were getting a refund because they were owed additional tax subsidies for insurance.