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  • Writer's pictureFair, Anderson Langerman

Supreme Court decision on the Affordable Care Act

Updated: Mar 6, 2023

The U.S. Supreme Court has agreed to hear California v. Texas (U.S. Supreme Court Docket 19-840), which will determine the constitutionality of the Affordable Care Act (ACA). If the Court determines that the ACA is wholly or in part unconstitutional, taxpayers may be entitled to refunds for imposed ACA taxes including:

  • The extra 0.9% Medicare tax

  • The 3.8% net investment income tax that has been paid on prior year returns

The statute of limitations applies to potential refunds. In order to preserve a potential 2016 refund, a protective refund claim can be filed for taxes paid on timely filed 2016 returns. These protective refund claims must be filed by July 15, 2020, and a tax CPA can help you do this.

There is no need to file an amended return, but for a refund claim to be valid, it must be in writing and signed, and include:

  • The taxpayer’s name, address, SSN or ITIN, and other contact information

  • A description of the contingencies the claim is based on (i.e.: the pending outcome of California v. Texas)

  • The essential nature of the claim (the refund of the extra 0.9% Medicare tax and the 3.8% net investment income tax)

  • The specific year(s) for which a refund is sought

The protective claim should be mailed to the mailing address that applies to the taxpayers’ Form 1040X.

Spidell Publishing has provided a sample letter which you can download here:

Consult a Tax CPA at FAL Today

To get clarity on any tax questions you may have or updates on how recent legislative changes can affect your taxes, contact a tax CPA at FAL today.

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