Health Insurance

IRS gives break to Obamacare filers who got wrong info

CNBC explains: Obamacare in 2015
VIDEO0:4100:41
CNBC explains: Obamacare in 2015

The Internal Revenue Service on Friday expanded relief to Obamacare customers who are filing tax returns based on incorrect information about their health plans.

The relief came in reaction to the disclosure by federal health official there were more errors on tax-related forms sent to Obamacare enrollees beyond the 820,000 forms identified as having problems last month.

Between 3 and 4 percent of customers of HealthCare.gov, the federal Obamacare marketplace, have some kind of errors on 1095-A tax forms related to their account, according to marketplace CEO Kevin Counihan. The errors could affect the amount of money a taxpayer owes the IRS, or is owed by the agency to the taxpayer.

Read MoreSick scams: $3.3B recouped from health-care fraud

The IRS said Obamacare customers who have filed or will file returns this tax season based on that incorrect data on their 1095-As will not have to file an amended return.

And the IRS "will not pursue the collection of any additional taxes from these individuals based on updated information in the corrected forms," according to a statement issued by the Treasury Department.

The relief applies to people who bought an Obamacare plan on any government-run exchange, be it the federally run HealthCare.gov that now serves 37 states, or a state-run marketplace.

A woman speaks with a health insurance agent regarding the Affordable Care Act.
Getty Images

But the Treasury Department noted those people still may want to check with their tax preparers to see if they should file an amended return. In some cases they could get additional money back from the IRS if they used the corrected tax form.Treasury said it intends to provide additional information to help tax filers determine whether they would benefit from filing amended returns.

It is unknown how many people could be eligible for the relief by virtue of having received a 1095-A form with incorrect information about their health plans.

"We don't have an estimate," said Mark Mazur, assistant secretary for tax policy at the Treasury Department. "We are thinking it's a relatively small number."

Read MoreObamacare rule: I need to declare what on my taxes?

The relief is more expansive than the similar relief offered last month by the IRS. The earlier relief had not included customers of state-run Obamacare insurance marketplaces, and only applied to those HealthCare.gov customers who had already filed their income tax returns based on the flawed data.

Last month, it was revealed that 820,000 flawed 1095-A forms had been sent out to customers of HealthCare.gov, which contained incorrect information about the prices of so-called "benchmark" health plans. Those benchmark places are are used to determine the value of tax credits that low- and moderate- income Obamacare customers to help pay for their own health plans.

Another 100,000 1095-A forms that contained incorrect data were sent to customers of Covered California, the state-run Obamacare exchange.

The tax credits customers receive are supposed to be reconciled on their income tax returns. If a person got too much in tax credits relative to their income, they will have to pay some of the credits back to the IRS, but if a person got too little in the way of subsidies they will be entitled to a refund.

But federal officials said Friday that the errors they are finding on 1095-A forms are not limited to the price of benchmark plans.

Counihan, the CEO of HealthCare.gov, said up to 4 percent of 1095-A forms of the exchange's customers have some kind of issue, including the "wrong coverage dates" for people's insurance. Counihan said the error rate is no unexpected given his experience running other health insurance marketplaces in Connecticut and Massachusetts.

HealthCare.gov's error rate for 1095-A forms, which is expected to be at least partially replicated on the forms sent customers of state-run exchanges, led the IRS to expand the relief it was offering Obamacare customers.

Counihan also said Friday that 740,000 1095-A forms containing corrected information about benchmark plan prices have been mailed out to affected customers, who can also view those corrected forms on HealthCare.gov.

Another 80,000 forms will be mailed out by next week, Counihan said.

Read MoreBig Calif. insurer stripped of tax-exempt status

Also Thursday, officials said that starting next week they expect to reveal tallies of the number of people who have enrolled for Obamacare plans during a special sign-up season that began last Sunday. The special enrollment period is for people who only became aware this tax season that they are subject to a fine for having failed to get health coverage last year.

This is the first year that people must declare on their income tax returns whether they had health coverage during the prior year.