Enter 1 (Yes) if everyone claimed on the tax return had minimum essential health care coverage (as defined by Form 8965 instructions) for the entire year. If you enter 1, you do not need to enter other data in this section, and the Individual Responsibility payment does not calculate on Schedule 4 (Form 1040), line 61. Enter 2 (No) if a family member did not have coverage for any part of the year. If this field is blank, it defaults to no minimum essential coverage and sends a critical diagnostic. This field is also available on the W2, 1099R, SSA-1099, C, F, and K1-3 screens. If you make a selection here, you do not need to do so in the other screens.

Enter X if household income (modified AGI for all tax family members required to file a tax return), gross income (as defined in IRS Section 61 for all tax family members required to file a tax return), or both are below the filing threshold. Form 8965 uses the calculated household and gross incomes, if applicable.

If any individual claimed on the tax return did not have minimum essential coverage for the entire year and the household and gross incomes exceed the exemption threshold, enter the details for each individual's coverage or exemption from coverage in this statement. The information entered in this statement will complete both Form 8965 and Health Care: Individual Responsibility, as appropriate.

Form 8965 will not print if every member of the tax household has coverage or qualifies for an exemption for every month, per IRS instructions.

By default, the Health Care Individual Responsibility penalty includes all individuals claimed on the tax return. Record every individual who should not be included in the Individual Responsibility calculation here, and indicate an exemption or coverage for each month they are not included. Report details of coverage on Form 1095-B and/or Form 1095-C.

If the Health Insurance Marketplace granted an exemption, enter the Exemption Certificate Number (ECN) in the corresponding column. The ECN must be seven characters; for ECNs with fewer characters, zeroes are automatically appended, as instructed by the IRS, to avoid an e-file error. If an exemption has been requested but the certificate number has not been issued, enter pending.

For more information about these exemptions, see the IRS page for Individual Shared Responsibility Provision - Exemptions. Also, Healthcare.gov provides a look-up tool for exemptions. For details, see Find health care exemptions that apply to you.

If different exemptions and coverage apply for an individual over the course of the year, enter each different exemption or coverage on a new row.

Enter X in the Full Year column, or select the appropriate Start Month and End Month for all applicable exemptions and coverages. For Forms 1095-B or 1095-C that have been entered via the Source Data Entry utility, the Start Month and End Month columns are blank, but the appropriate months are marked and the coverage or exemption calculates automatically for those months. If changes are required, use the Start Month and End Month columns to update.

In the statement, enter household income information. For Forms 8962, 8965, and the Health Care: Individual Responsibility Worksheet, this is the modified AGI of the taxpayer and each individual claimed on the return who is also required to file a tax return. Enter the AGI (Adjusted gross income from Form 1040, line 7), Nontaxable interest (Tax-exempt interest from Form 1040, line 8b), [[Foreign earned income exclusion (Form 2555, lines 45 and 50)]], and Nontaxable Social Security (difference between total Social Security benefits from Form 1040, line 5a and taxable Social Security benefits from Form 1040, line 5b). To exclude a dependent's MAGI from the household income calculation, enter X in the Do Not Include in Household Income column.

You can use the Family Transfer Utility to transfer dependent modified AGI information from a dependent's return. Otherwise, the MAGI information required to complete this statement is available in each dependent return on Worksheet 6, Dependent Modified Adjusted Gross Income Worksheet. If MAGI information was transferred via the Family Transfer Utility, the Client ID column will display the client ID of the dependents whose information was transferred. If the dependent did not have a requirement to file a tax return, the Do Not Include in Household Income column will be marked.

Form 8965 automatically calculates household income using modified AGI on the tax return and on the Dependents' Modified Adjusted Gross Income statement. For Form 8965 and Health Care: Individual Responsibility, this is the sume of AGI from Form 1040 line 7 and tax-exempt interest on Form 1040 line 2a, and if applicable, Form 2555 lines 45 and 50, or Form 2555-EZ line 18. Use this field to force a different amount.

The Health Care: Individual Responsibility payment must include dependents not claimed on the tax return but who are eligible to be claimed. In this statement, enter any dependent who is not entered on the 1040 screen, if every individual claimed on the tax return did not have minimum essential coverage for the entire year, and the household and gross incomes exceed the threshold for an exemption. Enter the details for each individual’s coverage or exemption from coverage, and date of birth, in this statement. If the individual did not have any coverage or exemption for any month, enter the SSN, Name, and Date of birth.

Enter the amount of nonspecified self-employed health insurance premiums paid for the self-employment income from either of the following sources.

• Other self-employment income/loss in the Other income statement in the Income screen
• Self-employment income/loss from contracts or straddles in the 6781 screen

Within the statement, specify the source of the self-employment income by completing the Form field. If the taxpayer obtained specified premiums via the Health Insurance Marketplace, see the notes section below. The self-employed health insurance deduction calculates automatically for Schedule 1 (Form 1040) or Form 1040NR return.

Enter eligible long-term care insurance premiums paid for the taxpayer, spouse, and/or dependents. Deduction limits are based on the code entered in the statement, attributable to the self-employment income from one of the following sources:

• Other self-employment income/loss in the Other income statement in the Income screen
• Self-employment income/loss from contracts or straddles in the 6781 screen

Within the statement, specify the source of the self-employment income by completing the Form field. Codes are available within the statement to identify for whom the premium was paid. The age of the taxpayer or spouse is verified from the date of birth information in the 1040 screen. For premiums paid on behalf of dependents, choose code 3, 4, 5, 6, or 7. Each entry is limited as required. See the following limitation table.

The deductible amount applied is based on the column in which you enter the amount. For example, if the taxpayer pays the premium, regardless of who it is for, enter the amount in the Taxpayer column. The Self-Employed Health Insurance Deduction Worksheet showing the calculation prints when applicable. The amount not allowed as a deduction for Schedule 1 (Form 1040), line 29 of the 1040 return automatically transfers to Schedule A as a medical deduction.

The codes that are available in the State Use field in the attached statement are specific to the state postal code entered in the State field. If state use codes are not applicable to the entered state, state use codes will not be available.

When the W2 screen (box 14) has medical insurance premiums, this field lists W-2s for the respective individual (either the taxpayer or spouse) that includes medical insurance premiums entered in box 14 of the W-2. Each W-2 includes the employer name. If the taxpayer or spouse qualifies for the self-employed health insurance deduction via the shareholder family attribution rules in IRC Sec. 318(a)(1), choose the corresponding W-2 unit here. The medical insurance premiums entered in the W2 screen, box 14m as well as the box 5 Medicare wages, will be reported on line 1 and line 5, respectively, of the Self-Employed Health Insurance Deduction Worksheet.