Shared Responsibility and domestic abuse

[jmcdtax]

According to the Marketplace Exemption form no documentation is needed to claim domestic abuse. See https://marketplace.cms.gov/applicat...-exemption.pdf And according to IRS Notice 2014-23 if married and suffering from domestic abuse you need to file MFS even though apparently you may have lived with the abuser for the last six months or are currently living with him or her. You do have to place the number 4 in box 8 of page 3 of the Hardship Exemption form. Some of the other hardship exemptions seem like they too are questionable and potentials for fraud. If we help fill out these exemption forms (you know you may be asked to do it) what are the due diligence requirements?

[cotopop1]

According to the Marketplace Exemption form no documentation is needed to claim domestic abuse. See https://marketplace.cms.gov/applicat...-exemption.pdf And according to IRS Notice 2014-23 if married and suffering from domestic abuse you need to file MFS even though apparently you may have lived with the abuser for the last six months or are currently living with him or her. You do have to place the number 4 in box 8 of page 3 of the Hardship Exemption form. Some of the other hardship exemptions seem like they too are questionable and potentials for fraud. If we help fill out these exemption forms (you know you may be asked to do it) what are the due diligence requirements?

There will be documentation required because taxpayer has to provide a written response in box 8 explaining how the domestic violence kept the taxpayer from getting health coverage for the time period they are requesting the exemption. I would suggest that you review taxpayers explanation and focus on 2 areas ; 1) does client's explanation make sense and in your opinion warrant a waiver 2) During your review and discussion of the facts with client are there any errors or omissions revealed and as a result explanation has to be changed (Section 10.21 of Circular ) . Remember it will be another party that make the decision whether the hardship will be approved .

[ATSMAN]

>> explaining how the domestic violence kept the taxpayer from getting health coverage for the time period they are requesting the exemption. I would suggest that you review taxpayers explanation and focus on 2 areas ; 1) does client's explanation make sense and in your opinion warrant a waiver

This is a tough one. As a tax preparer I am not willing to be the judge but if it does not pass the smell test it may be bogus. I would advise the injured spouse what the law requires and perhaps have her provide copies of say any restraint order, court filings, police reports etc.

But to prove that a domestic abuse prevented someone who had earnings over the poverty level is going to be tough.